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Published On: Wed, Jul 8th, 2020

31% of renters doubt they will be able to pay next month’s rent on time

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According to a LendingTree analysis of data collected by the Census Bureau in its ongoing Household Pulse Survey, about 2.1% of all renting households deferred rent for the previous month’s payment at the end of May. But the number of people deferring rent varies significantly by state, and overall, about 31% of renters have little to no confidence they will be able to pay next month’s rent on time.
LendingTree broke out the findings according to state and found that Ohio had the highest number of renters defer rent, as 5% opted for rent deferment last month. Nearly 1% of Ohio renters also said they already have plans to defer rent in August.
This means that Ohio renters added about $81 million in debt just last month, assuming entire rent payments were deferred.
The report said that Ohio’s high rate of deferrals could be linked to the decision of local courts to delay evictions and foreclosures, giving landlords incentive to arrange a payment workout.
Other midwestern and Rust Belt states also saw high numbers of tenants looking to defer rent, with Illinois, Indiana, Wisconsin and Michigan renters deferring payments at higher-than-national rates.
Deferring rent doesn’t mean payments will disappear – they are just put off, often due in a lump sum. LendingTree data shows that California renters will owe the most money as a result of deferrals — upwards of $219 million.
“This phenomenon is due to two factors: the state’s relatively high median rent of $1,520 and the state’s high population, which means that low 1.4% figure is equal to more than 144,000 renters seeking deferrals,” the report said.
Notably, not a single renter in Rhode Island deferred rent last month, and there were nine states that had less than 1% of renters saying they deferred the previous month’s rent and three states had less than 0.5% of renters deferring.
Meanwhile, unemployed renters in the U.S. reported a 2.7% deferment rate, while those still employed reported a 1.6% deferment rate.
Source: Housing wire

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