Latest Multifamily Data Shows Rents Falling, Card Payments Rising, and Little Turnover Despite Increase in Traffic

MRI Software’s Market Insights Report Tracks Recent Effects of COVID-19 on U.S. Multifamily Industry

The COVID-19 pandemic continued to impact the U.S. multifamily market in May, reflected in lower lease pricing, expanded use of credit card payments, increasing traffic and a tendency among residents to stay put, according to MRI Software (“MRI”), a global leader in real estate software solutions.

The firm’s latest report compares data from more than one million market-rate units (a subset of the total units managed by MRI clients) in February-May 2020 and February-May 2019.

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Key findings, which will be discussed in a webinar on Thursday, June 25 at 2 p.m. EDT, include:

• Lower prices: Pricing for new leases of 8-14 months decreased by 5% in May 2020 compared to May 2019. Last month’s pricing is also 7% lower than that of February 2020.
• Traffic is rebounding, but applications and move-ins are not. Traffic year-to-date has recovered to 101% of the same period in 2019, yet renters are generally staying in place at a greater rate compared to 2019.
• Wider use of credit cards for rent payments: Card usage in May was 58% greater than that of February 2020.
• Increase in 12-month leases: New 12-month leases were up 12% in volume in May 2020 compared with May 2019, and 12-month renewals were 7.4% higher in volume year-over-year.

“Some of these findings are expected in the face of uncertainty and recessionary thinking,” says Brian Zrimsek, Industry Principal, MRI Software.  “And while we applaud the use of electronic payments, which bring convenience to renters and landlords alike, the use of credit cards could signal increased risks if residents are paying with cards because of restricted cash flows as opposed to a desire to accumulate reward points. Many landlords have waived the fees for credit card usage, so it’s difficult to know the motivations for this behavior change.

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