Landlords lost about $9B in rental payments last quarter: report

Missed mortgage payments during the period totaled about $16B

National /
Sep.September 17, 2020 09:00 AM
(iStock)

(iStock)

Almost 11 million households were behind on rent or mortgage payments during the first three months of the pandemic.

Nearly 6 million of those households were renters, who reported either missing, delaying or paying reduced rent during the second quarter of the year, according to a report from the Mortgage Bankers Association. Just over 5 million households were homeowners that missed or deferred at least one mortgage payment.

The effect on multifamily property owners and mortgage lenders was in the billions, the report found. Unpaid rent cost landlords about $9.1 billion in revenue, while missed mortgage payments totaled an estimated $16.3 billion.

The report, produced by MBA’s think tank, Research Institute for Housing America, attributed missed payments to the spike in unemployment and reduction of work hours, but said that despite 11 million troubled households, most renters and homeowners were “largely successful” weathering the first three months of the pandemic.

“Data from other sources reveal that this trend has continued through August,” Gary Engelhardt, one of the report’s authors and an economics professor at Syracuse University, said in a statement.

The MBA report shows that property owners and lenders offered more assistance than tenants and homeowners actually used in the quarter.

Fifteen percent of renters were given permission to defer or reduce their rent, while only 37 percent of those offered this break took advantage of it.

A total of 10.5 percent of renters surveyed missed payments at some point during the quarter. Only 6.7 percent of those that missed payments did not receive landlords’ permission.

Around 20 percent of homeowners with a mortgage received permission from their lender to delay or reduce payments, and 31 percent took the offer.

Of those homeowners who didn’t receive a break from their lenders, only 3.3 percent missed a payment.

Engelhardt noted that a new federal stimulus package would be essential to help prevent more households, particularly renters, from running into difficulties paying their housing costs.

“Particularly for renters, the combination of those who missed a payment — or were offered and did not take it — is substantive enough to suggest real risk to their ability to make upcoming payments,” said Engelhardt.





    Related Articles

    arrow_forward_ios
    Don Lemon and Tim Malone with their apartment at 2280 Frederick Douglass Boulevard
    Making Lemonade: Don Lemon breaks even on Harlem condo sale
    Making Lemonade: Don Lemon breaks even on Harlem condo sale
    (IStock illustration by Kevin Rebong)
    Smaller cities look to cash in on shift to remote work
    Smaller cities look to cash in on shift to remote work
    Douglas Elliman chairman Howard Lorber (Getty)
    Douglas Elliman reports $14M profit, 50% revenue jump in quarter
    Douglas Elliman reports $14M profit, 50% revenue jump in quarter
    Glenn Kelman (Randy Stewart via Flickr)
    Redfin revenue grows as it races to hire more agents
    Redfin revenue grows as it races to hire more agents
    Photo illustration of Mayor Bill de Blasio as Uncle Sam (iStock, Getty/Illustration by Kevin Rebong)
    NYC has $1.3B in unpaid property taxes
    NYC has $1.3B in unpaid property taxes
    (Getty)
    Nearly half of home sellers overpaid their broker fees in 2020
    Nearly half of home sellers overpaid their broker fees in 2020
    (iStock/Illustration by Alexis Manrodt for The Real Deal)
    Manhattan job losses in Q3 worst of any large county in the US
    Manhattan job losses in Q3 worst of any large county in the US
    Jerome Powell (Getty)
    Powell sees new opportunity to reform low-income lending rule
    Powell sees new opportunity to reform low-income lending rule
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...