Over 36 million have filed for unemployment and others are bringing in less pay. Despite the massive spike in job-loss, 90.8% of apartments in the U.S. have collected rent in May.
What is the driving force?
A $600-a-week unemployment benefit due to the CARES Act has left many workers making more money now than when they were in their jobs. Congress enacted this figure by looking at the national average unemployment payout of $370 per week and the national average salary for unemployment recipients of $970 per week. The $600 figure was an attempt to make-up the difference.
The net result of all of the stimulus payments has been that millions of workers have experienced an increase in their overall pay without working! The apartment real-estate sector has been a backdoor beneficiary of that federal largess, since it has translated into more people being able to pay rent than one would expect with an official unemployment rate approaching 15%.
Should we be concerned?
Expanded government benefits are scheduled to expire at the end of July. Rental payment rates are varying widely by region as the above figures are a national average. Renters in strong cities with large employers are seeing rental collections as high as 94% and many cities have opened for business.
Much has happened in the past 2-months; an affordable rental market coupled with strong employment will only increase the chances of the positive trend toward recovery.
Please feel free to ask questions or post below.
For further questions, please contact me HERE.