HOT & RELEVANT TOPICS
More Than 80% of Households Made November Rent Payment
According to the National Multifamily Housing Council, 80.4% of rental households made a full or partial rent payment during the first six days of November. The figure represents a decrease of 1.1 percentage points from the same timeframe in 2019, but a 1 percentage point increase from the first week of October 2020. “November’s opening rent payment figures show that the additional support apartment residents received over the summer, coupled with generous, innovative approaches put into place by property owners and managers, continue to provide renters with some degree of security against the economic distress facing communities throughout the country,” NMHC President Doug Bibby said in a statement.
Meeting Budgetary Goals Through Ancillary Revenue
With the pandemic raging, apartment operators have seen their revenues take a serious hit. Many property managers have frozen renewal increases, waived a variety of fees and implemented concessions to sign new residents. But through ancillary income from pet amenities, convenience-based premiums and rentable items like garages, they can recover a significant portion of their lost income. “We’ve had to be proactive and adapt to keep the revenue where we need it,” said Crystal Martin, Director of Multifamily Operations for Leon Capital Group. “A lot of staying on pace for your revenue goals is based on how quickly your team is able to adapt and shift by utilizing tech tools and taking advantage of your existing resources.”
Using Preventative Maintenance to Prepare for the Holidays
Thanksgiving is fast approaching. And that means apartment operators could soon be getting frantic calls from residents about clogged sinks and broken ovens. So now is the time to engage in a little preventative maintenance. Have your maintenance techs check all the kitchen sinks, stove tops and ovens in your community before Turkey Day arrives. Examine all your main plumbing lines as well. And send a message to your residents outlining the proper use of garbage disposals.
IN THE NEWS
Many Young Renters Moving Back in With Mom and Dad
In September, according to a new Marcus & Millichap report, 25 million young adults were living at home. The figure was a good deal higher than the prior four-year average, and the number is poised to remain elevated as long as the pandemic-caused recession continues. Relatedly, the vacancy rate in core markets has increased 170 basis points to 5.8%, the highest mark since 2000, according to Marcus & Millichap.
Biden Victory Puts Trump Plans for Fannie, Freddie at Risk
The Trump Administration’s plan to release Fannie Mae and Freddie Mac from government control could be in jeopardy after the election of Joe Biden. During the 2008 financial crisis, the federal government took over the two mortgage giants and infused them with about $187 billion in bailout money. In exchange, the government received warrants to acquire nearly 80% of the companies’ shares. Under Trump, the Treasury Department and the Federal Housing Finance Agency have pursued a plan to re-privatize the government-sponsored enterprises. But Biden’s upcoming inauguration may not leave the Administration with enough time to achieve the goal.
Pandemic Hampers Apartment Construction
The economic environment caused by the pandemic is slowing multifamily construction, according to a survey by the National Multifamily Housing Council in October. According to the report, 57% of respondents reported construction delays in the jurisdictions where they operate. Among the reported reasons for the delays: waits for permitting, entitlement and professional services (67% of respondents); economic uncertainty (58%); and the availability of construction financing (46%).