About one-fifth of American renters did not pay their May rents as of Wednesday.
The National Multifamily Housing Council, or NMHC, found that 80.2% of apartment households made a full or partial rent payment by May 6, up slightly from 78% who had paid by Apr. 6.
“Despite the fact that over 20 million people lost their jobs in April, for the second month in a row, we are seeing evidence that apartment renters who can pay rent are stepping up and doing so,” said Doug Bibby, NMHC president. “We expect May to largely mirror April, when the payment rate increased throughout the month as financial assistance worked its way to people’s bank accounts… It is important to note that a large number of residents met their obligations despite unparalleled circumstances, and we will see that figure increase over the coming weeks.”
But Bibby cautioned: “We are in uncharted waters and will be watching this closely over the course of the month as millions of households will not be able to access unemployment benefits, and those who have [access] may find that they are not enough to cover rent plus all the other financial pressures caused by this crisis. Those benefits will also likely fall short in high-cost areas. That’s why we are calling on Congress to include $100 billion in direct renter assistance in the next pandemic relief package.”
Meanwhile, many American renters are very anxious about making rent payments.
On Apr. 28, before May rents were due, nearly two-thirds (64%) of renters were worried about their ability to pay rent in the coming months due to the coronavirus pandemic, according to a survey of 1,000 renters by Clever Real Estate, a St. Louis-based home buying and selling website.
"We’re experiencing an economic event that defies comparison. The economy came to a screeching halt and everyone is struggling right now. As unemployment claims continue to rise, and Americans wait to receive relief benefits, more people will have greater difficulty paying their rent,” said Bob Pinnegar, president and CEO of the National Apartment Association.
Clever’s survey also found that renters are 40% more likely than homeowners to have lost their jobs; and 58% more likely than homeowners to live paycheck to paycheck. Moreover, less than half of all renters have at least $500 in emergency savings.
Grace Hill, a South Carolina-based property management training firm, found that 60% of people it surveyed said they would use their government stimulus checks to pay May rents.
Missed rent payments also hurt landlords who need such funds to pay their own expenses, like mortgages.
"Most people don’t realize landlords don’t get wealthy on rent, in fact they are the last to get paid,” said Pinnegar.
More than 30 states have ordered bans on evictions and penalties for not paying rent.
In New York, on Thursday, Gov. Andrew Cuomo extended a statewide moratorium on evictions for both commercial and residential tenants through Aug. 20 from June 20.
“I hope it gives families a deep breath. Nothing can happen until Aug. 20,” Cuomo said. “I understand the anxiety, I understand the stress, but let’s remember who we are and what we’re all about and what principles matter to us.”
While some activists have called for eliminating rent payments entirely during the pandemic, Cuomo has resisted that idea.
“What’s going to happen on Aug. 20? I can’t tell you,” he added. “Whatever happens, we’ll handle it.”
Cuomo also said he will order a prohibition on landlords from applying late fees during the pandemic.
Some Democratic politicians were not satisfied with Cuomo’s pronouncements.
“Eviction moratorium is a band-aid on a gaping economic wound. We need real relief for people fast. Cancel Rent,” tweeted state Sen. Mike Gianaris.
Rep. Alexandria Ocasio-Cortez, who represents parts of Queens and The Bronx, has called for a nationwide cancellation of rent and mortgage payments during the pandemic.
Neither were landlords pleased with Cuomo.
“This is acknowledgment that struggling tenants will need additional assistance over the next four months. But that cannot be done on the backs of private building owners," said Joseph Strasburg, president of the Rent Stabilization Association. “No rent revenue means landlords are unable to pay property taxes, revenue that the city and state are counting on ... Real rent relief — not temporary band-aid approaches — is the only sensible way to protect tenants, landlords, the residential housing landscape, the city, neighborhood economies, and jobs and small businesses.”