July rent collection in affordable housing reached a low for 2020 at 76% of July 2019’s rates, according to findings from MRI Software.
It’s the first time that rent collection in the sector dipped below 80% this year, reveals the proptech firm.
However, rent collection in public housing saw a rebound from 78% of 2019’s rates in June to 98% in July, reports MRI Software, which recently compared data from more than 1.5 million affordable and public housing units from January to July this year and last year.
The results indicate growing challenges for tenants of affordable housing. For comparison, the National Multifamily Housing Council’s Rent Payment Tracker showed only a 2.1-percentage point decrease between rates of rent collections for professionally managed units in late July 2019 and late July 2020, said company officials.
“It’s clear that tenants of affordable and public housing are more vulnerable than those in market-rate units at this point in time,” says Brian Zrimsek, industry principal, MRI Software. “As the pandemic-driven recession continues, the mixed results we’ve seen over the past two months further underscore the fragile situation of many affordable and public housing tenants.”
The affordable housing in the report includes low-income housing tax credit developments as well as properties utilizing federal subsidies such as HOME as well as an array of state and local programs.
Other findings of MRI’s report include:
· Tenants in both affordable and public housing are generally staying in place. Applications, move-out certifications, and new admission certifications are far below those of 2019 and trending downward. In contrast, applications and move-outs are rising at market-rate units.
· Work order volumes for affordable and public housing are increasing. Although the volumes haven’t reached 2019 levels, the increases suggest a return to normal operations.
Zrimsek notes that MRI will continue to track trends throughout the pandemic. “The next few weeks will be telling, especially if there is a sustained drop in unemployment assistance,” he concludes.
