Despite nationwide reports of more residential tenants missing payments, landlords and property managers in Spokane County say most tenants made rent in April.

However, some worry that the full effects of the statewide “Stay Home” order won’t be felt until late spring or early summer. 

Chris Bornhoft, senior commercial broker with Windermere Manito Commercial who own 88 rental units, says he saw that about 97% of tenants paid by the sixth or seventh of the month, adding there are some tenants that normally pay late, and those that didn’t pay make up a small portion of the whole.

“It’s a little bit of a wake-up call. We have all been told personally in our own lives we need to have savings built up for emergencies,” he says. “Landlords aren’t exempt from this.” 

Initial data from the National Multifamily Housing Council at the start of the month showed 69% of renters paid by the fifth of the month, a 12 percentage point drop compared with March, which saw 81% of renters pay by March 5, and a drop compared to the year prior, which saw 82% of renters pay by the fifth.

However, updated data from the association show that 84% of apartment households made full or partial payments by April 12, up 15 percentage points from April 5.

Similarly, data from ApartmentList.com’s economic team shows 13% of renters paid a portion of their April rent bill, while 12% made no payment at all. A similar percentage of homeowners were delinquent on their mortgage payments.

One in nine renters had their landlord or management company reduce their April rent, according to data collected by ApartmentList.com. Among those who didn’t pay, 45% of renters and 44% of homeowners agreed to reduced or deferred payments with their landlords and lenders.

County-level data wasn’t available.

Eric Bessett, pres–ident of Spokane-based Madison Real Estate & Property Management Inc., says rental revenue was down 14.7% for April compared with March.

“The majority of people were able to pay rent,” says Bessett. “The remainder, for the most part, tried to pay partial.”

The company manages over 600 units in the Spokane region, most of which are single-family homes that range in rental rates from $800 to $3,000 a month.

Tenants and landlords were nervous coming into April, Bessett contends, with tenants concerned about making rent and landlords concerned about being able to pay their mortgages.

“The vast majority of our owners have mortgages they’re paying. They don’t own the properties free and clear,” he says. “Most of my clients are your average middle class (people) just trying to do something to pad their retirement. Or have a retirement.” 

Despite this nervousness, Bessett says most of the landlords he works with have called and expressed concern for their tenants, often offering to work with tenants and either cover part of the rent for the month or forgive the month’s rent altogether if needed.

Bessett says most landlords he works with have said they can manage the shutdown for one to two months, however, if it lasts three or four months, things could get ugly, a sentiment echoed by several others in the industry.

Apartments.com data shows that 27% of those who paid their April rent in full weren’t confident they could continue to pay rent if a shelter in place lasts through June.

Beyond mortgage payments, landlords also have the costs of maintaining rental properties which includes utilities, grounds maintenance, and taxes, all of which are covered by rent, Bornhoft says. Even with a majority of renters paying this month, over the long run partial or decreased payments is not sustainable, he says.  

Dave Black, CEO of Spokane-based NAI Black, says the company collected about 90% of the rent it normally would in March. Black Realty Management Inc., NAI Black’s property management firm, manages about 4,000 multifamily units, Black says.

“There’s a big difference between losing your paycheck and losing rents as a landlord,” he says, noting a lot of people were able to pay April’s rent using their reserves.

He adds, “I think people are going to remember how people behave during this time,” whether it’s a tenant who was treated poorly by a landlord, or vice versa, or a lender who didn’t receive payments.

The Tenants Union of Washington Spokane chapter is calling for either a freeze on rent and mortgage payments, or for local leaders to establish a rental assistance program, according to the organization’s website.

The cities of Bellingham, Burien, Seattle, and Federal Way have passed resolutions requesting Gov. Jay Inslee waive rent and mortgage payments during the coronavirus outbreak. 

Inslee extended and expanded a moratorium on some evictions to extend through the first week of June. It prevents landlords from issuing 14-day pay-or-vacate notices and from issuing 20-day termination notices. The updated order also prohibits landlords from charging late fees or fees for nonpayment and requires landlords to offer a reasonable repayment plan to tenants to catch up on overdue rent. 

Spokane City Council President Breean Beggs says city leaders will review the updates to the governor’s order to determine what further protections the city should implement to protect landlords and tenants. 

Beggs says he expects the city will extend its foreclosure protections to match the governor’s extension to June 4. 

Speaking generally, Bornhoft says the solution isn’t a rent strike by tenants on one hand or a pay-or-vacate order by landlords on the other.

Tenants and landlords should instead be communicating if they’re concerned about not being able to make payments, he contends.

Some landlords may be willing to waive late fees, accept partial payments, or defer payments, he says. 

“I’m not an advocate of saying, ‘hey, let’s just give everybody free rent,’ because landlords have actual hard costs,” he says. “Any kind of rental property is going to have a hard cost whether the landlord has a mortgage or not.”

For his units, Bornhoft says he’s halted planned rent increases that had been scheduled in April and is working with tenants who are struggling to pay.

“You can’t be afraid to communicate,” he contends, a sentiment echoed by several in the industry. 

With Washington’s “Stay Home, Stay Healthy” mandate not being implemented till late March, several people still received paychecks at least half-way through the month, which several in the industry contend contributed to the high rates of rent payment. However, with unemployment surging in late March and into April, May could tell a different story. 

“I think the story will be somewhat different, but you’ve got stimulus checks coming. You’ve got unemployment,” says Bessett. “It’s really just going to depend on so many factors. There’s no way to predict it.”