Tenant Payment Performance Update 2024 4th Quarter (Oct, Nov, Dec)
NOTE: we originally started publishing this data monthly back in April of 2020 to assist our clients in understanding the developments & corresponding challenges related to the Eviction Moratorium. With most landlord-tenant courts pretty much back to normal, and very little feedback from our audience about the data, we’ve decided to save our staff time and switch to publishing the data quarterly. Please let us know your thoughts!
We’re unaware of any other local management company sending their clients these updates!
Please share this with anyone interested in real estate investing or looking for better property management – so, they can see what they are missing!
GENERAL EVICTION UPDATE
While most courts are back to “normal”, we’re still dealing with challenges caused by Legal-Aid attorneys, who represent tenants for free.
They use legal extortion tactics to “encourage” landlords to accept a Conditional Dismissal settlement, to keep an eviction from being entered against a tenant in public records for future landlords to see. To do this, they threaten to request a jury trial, which may take 6 months or more to schedule, allowing a tenant to stay.
Some good news is judges seem to be tiring of this tactic! Requesting a jury trial technically requires the tenant to escrow rent payments with the court until the case is resolved. Failure of a tenant to do so should result in a default judgment against the tenant. In the past, many judges did not really enforce this requirement, so the tenants effectively lived rent-free. We’re now seeing an increase in judges requiring and enforcing this requirement.
Federal Eviction Moratorium funding is running out for Legal-Aid, which is causing their offices to be more selective about tenants they chose to represent. So, we’re getting back to “normal” where only tenants with landlords violating the law may receive free legal assistance.
The Holiday Effect
During the holiday season, courts seem to always be more lenient in executing evictions and putting tenants out of their homes. Many judgments and writs included notes indicating that executions could not proceed until after the New Year. Unfortunately, we deal with this every year.
NOTE: January is typically the worst month for rent payment issues. Many tenants live paycheck-to-paycheck and choose Holiday spending over paying rent.
Don’t panic!
We’ve dealt with this for decades and know that most, if not all, tenants with past due balances will use their income tax refunds to payoff these balances to avoid eviction. They start receiving these refunds as early as late February.
We don’t take this for granted though, so will follow our Eviction processes to keep pressure on tenants to pay or move.
RENT PAYMENT TRENDS 30-60-90+ Days Behind Update
Even during the holiday season, Tenant Payment Performance remained steady, with almost 90% of tenants paying their full rent. Additionally, we saw several tenants successfully complete their formal Payment Plans, bringing their past due balances current.
Macomb County Tenant Performance
We created a lot of success in Macomb County, with the highest number of tenants completing their Payment Plans. Additionally, the number of tenants paying zero rent is now zero!
Oakland County Tenant Performance
Oakland County experienced a different smaller trend, with a very slight increase in the number of tenants falling behind on rent, as expected during the Holiday Season. However, the majority of these tenants are now enrolled in our systematic Payment Plans to help them get back on track. Again, the number of tenants paying zero rent is also now zero.
Wayne County Tenant Performance
We’ve been able to stabilize the number of Wayne County tenants paying full rent at almost 90%! As the graph below shows, more tenants are paying partial rent via our systematic Payment Plans. We aggressively follow up with these tenants to keep them on track and to at least avoid falling further behind. This has resulted in a significant drop in tenants paying zero rent.
