Idaho COVID Rent Collection vs. the rest of the U.S.
In March of this year, uncertainty regarding rent collections arose surrounding the COVID-19 shutdowns. In response, we prepared to make payment arrangements, waive late fees, and be as flexible as needed in order to retain residents. At the beginning of the pandemic, concerns surrounding government-mandated rent forgiveness placed an even greater amount of concern surrounding the future of rent collection. Since then, the Treasure Valley housing market has upheld its strength--a truly remarkable feat.
Rent collection through our portfolio has been near normal throughout the entire pandemic. Month after month, we have maintained a 98% rent collection rate. Although rent collection has been solid, we have experienced an increase of ~30% more payment arrangements compared to last year. Residents submitting payment arrangement requests must provide proof stating that their income has been adversely affected due to the pandemic.
Idaho's political environment has played a positive role in rent collection. By keeping businesses open for the most part, Idaho has ranked the 3rd best in the least amount of jobs lost since the pandemic began.
In his annual address to the Associated Taxpayers of Idaho, Governor Brad Little (R) stated, “In large part, we have our businesses and the business community to thank for that,” he then remarked, “Idaho’s businesses have demonstrated great resiliency and agility during the pandemic, and have done a great job of protecting their workers and their patrons. However, our fight with COVID-19 is far from over. In all parts of the state, we are seeing increased community spread.”
Other states that have adopted more tenant-friendly policies have seen greater challenges in rent collection. Researchers at the Federal Reserve Bank of Philadelphia used payroll, joblessness, and unemployment insurance data to create a more precise estimate of how many households nationwide are behind on their rent. The number they produced is far lower than the figures presented by other studies. The researchers estimated that by year-end around 1.34 million renter households will be behind on their rent as a result of pandemic-related job losses, which equates to roughly 4.2% of all renter households. Altogether, these households will owe roughly $7.2 billion in rent by December, averaging to around $5,400. It's no surprise that this year has been full of challenges. Even so, Idaho continues to be an attractive market due to its political climate, landlord-friendly policies, and strong economic outlook. In the midst of uncertainty, the Idaho economy has remained strong and we are optimistic that it will hold up well into 2021!
If you are a developer or multifamily investor we would love to connect with you! Email our CEO, Natalie Lemas to schedule a call today.