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Key Takeaways
In August 2024, the on-time payment rate in independently operated rental units fell for a third consecutive month, sliding to 84.9%.
Compared to the post-pandemic peak, the national on-time payment rate is down by 332 bps.
Western states, led by Idaho, Utah, Colorado, and Nevada, continue to have the highest on-time payment rates in the country.
Single-family rental properties held the highest on-time payment rates of all sub-property types in August, coming in at 85.3%.
National Overview
On-time rental payments in units operated by independent landlords slid again in August 2024. An estimated 84.9% of tenants in independently operating rental units completed their monthly payments on time. The on-time payment rate is down by 50 bps from the month prior and 332 bps from the post-pandemic peak — reflecting a gradual and consistent deterioration in collection performance.
Note: As of May 2024, monthly data estimates are reported as a three-month moving average.
Following a period of exceptional apartment sector rent growth in 2021 and 2022, on-time payments began falling in the Spring of 2023 — falling from a high of 88.3% in April to the current low of just under 85%. After collection rates appeared to stabilize in the Spring, they have proceeded to fall in each of the past three months of data.
August’s forecast full-payment rate, which includes on-time payments, late payments, and expected late payments based on historical trends, came in at 94.0% — down 69 bps from July and 213 bps from this time last year. Full collection rates are down by 320 bps from their post-COVID high (97.2%) — however, they remain up 369 bps from the September 2020 low (91.3%)
Trends within key rental subsectors reveal a slight gradient of performance. Of the three tracked property sub-types, multifamily properties had the lowest on-time payment rate in August 2024, coming in at 84.1%. properties with 2-4 rental units followed next with an on-time payment rate of 84.5%. Leading the sub-property types in June were single-family rentals, holding an average on-time payment rate of 85.3%.
Measured by State, western-located properties continue to outperform the rest of the country. On-time payment rates stand highest in August 2024 in Idaho (93.8%) — followed by Utah (92.0%), Colorado (91.2%), Nevada (90.1%) and New Hampshire (89.7%)
Data Findings: By Property Type
Data Findings: By State
About This Report
The Independent Landlord Rental Performance report is a real-time look at how well non-institutional operators are collecting owed monthly rental payments. Utilizing data provided by property management software RentRedi, these findings have a reduced sample size of 91,849 units, which are analyzed and reported by Chandan Economics. Where sample size quality meets sufficient reporting standards, data are offered from March 2020 forward, and new trends and analyses are reported monthly. Performance trends are discussed nationally, as well as along the lines of residential property type and geography.
Data contained within this report offer investors, brokers, academic researchers, and policymakers a benchmark to track the performance and health of independent landlords.
About: Chandan Economics
Chandan Economics is an economic advisory and data science firm serving the commercial real estate industry. The firm's primary businesses include real estate data science (REDS), economic & market research, and litigation consulting.
About: RentRedi
RentRedi offers an award-winning, comprehensive property management platform that simplifies the renting process for landlords and renters by automating and streamlining processes. For landlords, RentRedi provides all-in-one web and mobile apps to collect rent, list and market vacancies, find and screen tenants, sign leases, and manage maintenance and accounting. For tenants, RentRedi’s easy-to-use mobile app allows them to pay rent, set up auto-pay, build credit by reporting rent payments to major credit agencies, prequalify and sign leases, and submit maintenance requests.Founded in 2016, RentRedi is VC-backed and a proven leader in the PropTech market. The company ranks No. 180 on the 2024 Inc. 5000 list, No. 12 on the Inc. 5000 Regionals list, and was named an Inc. Power Partner, a GetApp Category Leader, a Capterra Established Player, and a G2 High Performer and Momentum Leader based on the software’s user ratings and popularity. To date, RentRedi has more than $35 billion in assets under management with nearly 200,000 landlords and tenants using the platform. The company partners with technology leaders such as Zillow, TransUnion, Experian, Equifax, Realtor.com, Plaid, and Stripe to create the best customer experience possible. For more information visit RentRedi.com.
Methodology
Data are reported on a forward basis from March 2020 through August 2024 (current reporting period). As of the latest month of data availability, the reduced unit sample size totals 91,849. Rent charges are measured on a 15th-to-15th-of-the-month basis. Rent charges that are issued after the 15th of the current month are treated as a rent charge for the following rent-tracking period. (E.g., a rent charge sent on August 16th would be treated as a charge corresponding to September's owed rental payment.) Monthly estimates are represented as a three-month moving average.
Only charges designated as "rental income" are included for analysis. Rent charges below $500 and above $10,000 are excluded from this analysis.
Units that have not paid any form of rental income (full or partial) in the previous 60 days at the time a new rental charge is issued are removed from the sample tracking sample. Unpaid units refer to all units that have yet to fully satisfy their owed rents for a collection period. These unpaid units include units that have only partially paid their rent. As a means of reporting standardization, units with more than one monthly rent charge (E.g., rent paid weekly) are removed from the rent tracking sample.
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