Shock: Nearly 9 in 10 Apartment Dwellers Paid Rent in May

Woman in apartment in the morning
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The rental apocalypse never happened.

When the coronavirus pandemic struck and much of the economy was shutdown, there were many grim forecasts that Americans would not be able to make rent payments. In late March, the New York Times warned that 40 percent of renters in the U.S. might not pay rent in April.

Those forecasts fueled worries about financial stress from landlords defaulting on mortgages and policies aimed at preventing evictions. Some even worried that the anti-eviction policies would incentivize tenants to stop paying rent. Others called for a nation-wide moratorium on rents.

The rent shortfalls have not happened. Eighty-nine percent of apartment households made a full or partial rent payment by June 13, a 0.1 percent increase from one year earlier, according to the National Multifamily Housing Council’s rent payment Tracker.

So Americans were slightly more likely to pay rent in May than they were a year ago.

It is also an improvement from the 87.7 percent who paid rent through May 13. Eighty-nine percent of apartment households made rental payments through April. Back in March, prior to the avalanche of unemployment claims, 91 percent of apartment dwellers paid rent.

The figures come from a survey of 11.4 million apartment units across the country.

It is a bit of a mystery why more Americans have not stopped paying rent or delayed making payments given record-high unemployment, mass layoffs, and so many businesses being shutdown. Especially since many states and cities have barred evictions. Similarly, many home-owners have continued to make mortgage payments despite qualifying for or being granted mortgage relief.

It may be that many renters expect the downturn to be short-lived and do not want to fall behind on rental payments, even if that means putting more of their household expenses on credit cards or tapping their savings. It’s also likely that the pandemic economic relief programs are helping renters pay their bills. Particularly, the $1200 federal government income support payment and the extra $600 per week in unemployment insurance has given many households extra spending power. The Paycheck Protection Program has also likely kept more Americans in their jobs than many expected.

It is still possible that rent shortfalls will develop if the boosted unemployment payments are allowed to expire in July while the economy is likely to still have far fewer open jobs than unemployed people.

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