April 23, 2020
Not since 2008 has there been such a dramatic shift in the rental market as in the past month, as the COVID-19 pandemic spread. New research by Seattle-based Kidder Mathews reveals exactly how that change played out on the multifamily market in Oregon and Southwest Washington.
Kidder Mathews’ multifamily investment team in Portland, including Jordan Carter, Clay Newton, and Tyler Linn, surveyed multifamily owners and managers that are responsible for more than 11,300 rental units. The findings show how rent collections fared in early April, the first month following sweeping eviction moratoriums across most submarkets.
Across the survey, the total percentage of leased units not paying rent for April was 9.97%. Combined with the average vacancy of 3.45%, the overall percent of uncollected gross rent was at 13.42%. National reports had pegged the number at 31%.
Properties located in Portland reported the highest percentage of units not paying rent, but not by a wide margin. However, despite a requirement by Multnomah County for tenants to provide evidence of financial hardship, Portland had the lowest percent of unpaid units that notified management compared to other surveyed submarkets.
The survey found properties offering tenants financial incentives for on-time payment only had 6.8% of units not paying for April, compared to 10.29% for properties that did not offer incentives.
While unpaid rent collection for April doesn’t appear as bad as many expected, 73% of those surveyed expect collections for May to be worse. Only 25% of those surveyed believe most tenants will pay back unpaid rent; 15% think they’ll never be repaid, and 56% think they will collect some, but not all, or they are unsure what will happen.
The survey clarifies statistics about rent collections in these local markets that previously were misleading in national reports or came from institutional sized portfolios.
For comments, questions or concerns, please contact Dennis Kaiser