News July 22, 2020

Low Turnover Persists in Multifamily Units Across Asset Classes, Rent Rebounds in Market-Rate Housing

By MRI

Latest Reports from MRI Software Track Effects of COVID-19 on Market-Rate, Affordable, and Public Housing Throughout the U.S.

Solon, Ohio – July 22, 2020 – Rental pricing at market-rate properties increased in June, reflecting low turnover at multifamily units across asset classes and growing demand for market-rate units, according to the latest reports from MRI Software (“MRI”), a global leader in real estate software solutions.

The firm compared data from more than one million market-rate units and 1.5 million affordable and public housing units throughout the U.S. in February-June 2020 and February-June 2019. Key findings include:

  • Rise in lease pricing at market-rate properties: Lease pricing in June recovered from a 5% decrease in May, nearing 2019 levels. This trend reflects 1) the tightening supply of units as tenants across all asset classes stay put; and 2) the jump in traffic volume at market-rate properties (18% over June 2019).
  • Continued increase in usage of card payments among residents of market-rate units (up 78% in June as compared to February). MRI attributes the increase to one of two factors: credit card fee waivers from landlords or residents’ struggles with cash flow.
  • Significant variation in work orders across asset classes. Market-rate properties saw a rebound of service requests (back to 2019 levels), indicating a return to normal maintenance operations.  In contrast, service requests at affordable and public housing comprised only 75% and 50% of the prior year, respectively.

Although some of the data points suggest the beginning of a recovery, Brian Zrimsek, Industry Principal, MRI Software, expressed a few reservations. For example, he views the increase in credit card payments among residents of market-rate units as cause for concern: “Residents may be amassing credit card debt in order to pay rent. This is especially worrisome given the coming expiration of enhanced employment benefits, along with the rise in COVID-19 cases in major multifamily markets across the country, which could lead to renewed shutdowns and more unemployment.”

He concludes: “Governmental policies that protect individuals as well as businesses will help determine whether we encounter a perfect storm or a situation where landlords and tenants can keep themselves afloat throughout the pandemic,” he continues. “In the interim, analysis of data can inform decision-making.”

Both Market Insights reports can be downloaded from MRI’s website:

MRI will discuss the findings in more detail during a webinar on Thursday, July 23 at 2 p.m. EDT, featuring guests from AvidXchange, Conservice, HappyCo, and FCO, all MRI partners.

About MRI Software
MRI Software is a leading provider of innovative real estate software applications and hosted solutions. MRI’s comprehensive and flexible technology platform coupled with an open and connected ecosystem meets the unique needs of real estate businesses – from property-level management and accounting to investment modelling and analytics for the global commercial and residential markets. A pioneer of the real estate software industry, MRI develops lasting client relationships based on nearly five decades of expertise and insight. Through leading solutions and a rich partner ecosystem, MRI gives organizations the freedom to transform the way communities live, work and play while elevating their business and gaining a competitive edge. For more information, please visit mrisoftware.com.

MEDIA CONTACTS:
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Rachel Antman (+1 212-362-5837)
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(UK) Platform Communications for MRI
PJ Chou (+44 20 3219 5837)
Zoe Mumba (+44 7725 832393)
or Hugh Filman (+44 7905 044850)
mri@platformcomms.com

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