Stay-at-home orders related to the COVI / D-19 pandemic have not dampened rental demand for single-family homes, executives from two REITs said in recent first-quarter earnings calls.
Dallas Turner, president and CEO of Invitation Homes, said occupancy hit a record 97.2% in April as the company increased its access to working capital and suspended research for news acquisitions to prepare for the many uncertainties of the pandemic.
“Shelter-in-place did not impact our ability to rent homes,” Turner said. In fact, he said, residents have moved into company properties at the same rate as last year and faster than they have left.
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David Singelyn, CEO of American Homes 4 Rent, said that while first-quarter housing occupancy was slightly behind last year’s figures, housing demand rose significantly in April and generated record levels of projections. Singelyn said he expected good rental and occupancy figures in May.
Demand for single-family rental housing is increasing as potential buyers postpone or cancel purchases during the economic downturn, Singelyn said. Single-family homes are also attracting residents living in multi-family dwellings who are now looking for lower density options in light of the pandemic and recommendations for maintaining physical distance, he said.
“Today’s story is the COVID-19 crisis,” Singelyn said.
Rent collections did not drop precipitously, executives said, despite a national unemployment rate that jumped to 14.7%, the highest since the Depression era. Charles Young, CEO of Invitation Homes, said rent collection in April was over 95% of the company’s historical average. Half of those missed rents have been paid since the April closing of the books, Young said.
The number of rent payments improved in May with collection rates through the fifth day of the month exceeding 100% of the pre-COVID-19 average, according to the company.
“We love our sticky, high-quality resident base, and we believe the ripple effects of this pandemic could make the option of renting a single-family home even more appealing,” Young said.
At American Homes 4 Rent properties, 82% of rent payments were made through May 5, which matches April figures and is less than 6% of the company’s historic rate, a said COO Bryan Smith.
American Homes is not forgiving the rent, but has suspended late fees and stopped evictions. About four percent of residents on company properties have asked for help with hardship, Smith said.
“The longer this crisis lasts, the more difficult it can be for some of our residents to maintain regular rent payments,” Smith added.