Big Landlords Are Seeing Record Profits During the Pandemic
If you’re tempted to feel sorry for residential property owners who haven’t been able to evict late-paying tenants during the COVID-19 pandemic, don’t shed any tears for them just yet.
According to a Monday report from CBS News, many of those companies remained profitable during the pandemic, and some recorded record profits. CBS MoneyWatch reviewed the financial statements and loan records of the biggest landlords in the U.S. and found that they’ve been mostly profitable during the pandemic — despite a federal moratorium that went into effect in September banning the eviction of tenants for falling behind on their rent payments.
Among the review’s findings:
- Invitation Homes, the nation’s largest single-family-home landlord, had its most profitable year ever in 2020.
- Rents at Mid-America Apartment Communities rose 2.5% last year on properties it owned pre-pandemic. Operating profits rose 60%.
- The real estate data firm Trepp found that as of January, the delinquency rate for loans tied to apartment buildings was only 2.3% vs. 19% for hotel owners and 13% for retail malls.
- Ironically, the eviction moratorium might have bolstered the bottom lines of residential landlords because it reduced turnover, which is an expensive process.
That moratorium will remain in place for at least the next three months. As Reuters reported on Monday, the U.S. Centers for Disease Control and Prevention extended the moratorium through June 30. It had been scheduled to expire on Wednesday. It was the second extension since President Joe Biden took office.
According to White House estimates, about one in five renters in the U.S. are behind on rent. The CDC, citing Census Bureau data, found that more than 4 million adults who are behind on rent fear imminent risk of eviction.
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