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Key Takeaways
In September 2024, the on-time payment rate in independently operated rental units fell for a fourth consecutive month, sliding to 84.9%.
Compared to the post-pandemic peak, the national on-time payment rate is down by 334 bps.
The eight states with the highest on-time payment rates are all located in the West, led by Utah, Idaho, Colorado, and Nevada.
Single-family and 2-4-family rental properties held the highest on-time payment rates of all sub-property types in September, coming in at 85.1%.
National Overview
On-time rental payments in units operated by independent landlords slid for the fourth consecutive month in September 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 19 bps from the month prior, 148 bps from the same time last year,  and 334 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.
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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 four months of data. Â
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Despite the decline in on-time payment rates, there are signs of stabilization. September’s forecast full-payment rate, which includes on-time payments, late payments, and expected late payments based on historical trends, came in at 94.5% — an improvement of 21 bps from August. Nevertheless, full collection rates are down by 275 bps from their post-COVID high (97.2%).
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Trends within key rental subsectors reveal a slight gradient of performance. Of the three tracked property sub-types, single-family rental (SFR) and properties with 2-4 rental units came in neck-and-neck in September — with both property types having an on-time payment rate of 85.1%. Meanwhile, average on-time payment rates in multifamily properties sat slightly lower at 84.5%.
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Measured by State, western-located properties continue to outperform the rest of the country. On-time payment rates stand highest in September 2024 in Utah (93.8%) — followed by Idaho (92.0%), Colorado (91.2%), Nevada (90.1%) and Washington (89.7%). It is not until ninth on the list that a non-Western state (New Hampshire, 89.0%) appears.
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 94,250 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 September 2024 (current reporting period). As of the latest month of data availability, the reduced unit sample size totals 94,250. 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 September 16th would be treated as a charge corresponding to October'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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