Industry Trends Report | Week of April 13
HOT & RELEVANT TOPICS
Property Management Without the Option of Eviction
Evictions aren’t an option for many property managers right now, with federal, state and municipal moratoriums on the eviction of renters who miss payments due to job issues stemming from the COVID-19 crisis. Even where eviction bans aren’t in place, the process can’t move forward because the municipal courts that would typically handle eviction filings are closed. Managers are struggling to balance the needs of residents with the pressure to continue operations and still make their own mortgage payments. In April, 69% of renters still paid their rent on time, but May will likely see lower numbers. Payment plans and lease extensions are temporary solutions for renters, but the apartment industry may ultimately require protections, tax relief and recovery assistance.
Tips for Real Estate Marketing During the Pandemic
The adage, “If you aren’t growing, you are dying,” still holds true during the COVID-19 crisis, but real estate marketing can be tricky during this unprecedented situation. Due to job uncertainty, consumer confidence is low but there are still ways to reach customers by following some key guidelines. Stay positive, avoid the perception of capitalizing on the crisis, don’t sell too aggressively and know your customer’s current mindset. Maintain availability through virtual meetings and technology, and use this time to train associates and audit social media content. While stay-at-home orders are in place, now is also the time to take property photos and produce video materials without disrupting residents’ lives.
Where Will Co-Living Land Post Pandemic
Co-living had become a primary option to combat the rental-housing shortage, a way for residents to live in luxury spaces for affordable prices. But what now? The economic disruption caused by COVID-19 will almost certainly drive demand for cost-cutting measures such as co-living when things return to normal. But it remains to be seen whether residents will want to live in close quarters after what could be months of social distancing. In the short-term, co-living operators are being forced to get creative, including lowered rents and strict cleaning guidelines.
IN THE NEWS
More Resources Needed to Weather COVID-19
While the $2 trillion CARES Act provided significant funding to assist vital housing programs, it largely failed to address the needs of the multifamily industry as it struggles to navigate the COVID-19 pandemic. With unemployment rates skyrocketing, industry leaders have called for an increase in emergency housing assistance funds for renters, as well as modifications to the multifamily forbearance and eviction moratorium provisions in the CARES Act. In addition, requests have been made to expand programs that protect and fund the assistance efforts of multifamily businesses. Moving forward, communication between property managers and their residents will be key to accurately assessing the required scale of any additional relief packages.
Explaining the Breakdown $1 of Rent
A misconception exists that rental-housing owners enjoy ample profit margins and should have no trouble continuing to operate in the absence of rent payments. The National Apartment Association released a video and infographic that explain how the average rent dollar is allocated. The content shows that only 9 cents of every dollar is returned to apartment owners, while 39 cents pays for the mortgage on the property, 27 cents covers payroll expenses, 14 cents are allocated to property taxes and 10 cents goes toward capital expenditures, such as roof replacement. With May 1 on the horizon, the apartment industry is aiming to help society understand the benefits of rental payments to all Americans, renters or otherwise.
Camden’s $5M Relief Fund Empties in 16 Minutes
Camden Property Trust had created a $5 million fund to provide financial relief for residents in times of crisis. That fund expired 16 minutes after it was opened for applications. In that time, the company received 2,520 applications for relief from residents, at which point the online portal closed to any further applications. Under the relief fund, eligible Camden residents were able to apply for a one-time, forgivable grant up to $2,000. Camden operates 164 communities with more than 56,000 units across the country, and the company had already waived late fees for rent, instituted a moratorium on evictions and sent out renewal notices with no increases.