KEY POINTS About 69% of apartment households in the U.S. had paid their monthly rent through Apr. 5, down from 81% in March.

Renters are especially vulnerable to financial risk as they tend to have lower incomes than homeowners

Some 45% of renters do not have enough in savings to pay the rent for even a single month.

About one-third of U.S. renters failed to pay their rents for the month of April, largely due to job losses arising from coronavirus-related business closures.

The National Multifamily Housing Council, or NMHC, said 69% of apartment households in the U.S. had paid their monthly rent through Apr. 5, versus 81% that had paid by Mar. 5, 2020, and 82% that had paid on time in April 2019.

“The COVID-19 outbreak has resulted in significant health and financial challenges for apartment residents and multifamily owners, operators and employees in communities across the country,” said Doug Bibby, president of NMHC. “However, it is important to note that a large number of residents met their obligations despite unparalleled circumstances, and we will see that figure increase over the coming weeks.”

Renters are especially vulnerable to financial risk as they tend to have lower incomes and more unstable jobs than homeowners. A survey by the St. Louis-based listing website Clever found that renters comprised 35% of people who have lost income due to the pandemic. Some 45% of renters do not have enough in savings to pay the rent for even a single month.

Some landlords are working with tenants to maneuver through this crisis by waiving late fees and offering more flexible payment schedules.

Granger MacDonald, a landlord in Kerrville, Texas with more than 4,500 units, said: “I started worrying when restaurants and public spaces started shutting down. I know it was necessary, but, man, it’s painful… When our tenants started getting laid off, I knew we had a huge problem.”

Most of MacDonald’s tenants work in the services industry which has been hit hard by layoffs.

Clever’s survey also revealed that about 10% of renters received rent forgiveness or rent reductions from landlords.

Another survey by Avail, a tenant management platform based in Chicago, found that nearly one-third (32%) of renters said they would simply cease paying rent if they couldn’t afford it, rather than taking out loans to cover such payments.

“Landlords need to know that there’s a problem. Tenants need to contact their landlord to talk about their issues,” said David Howard, executive director of the National Rental Home Council, an advocacy group based in Washington D.C.

The Texas landlord MacDonald said as of Apr. 3, about 30% of his tenants were past due and neither asked for a flexible payment plan nor communicated with him. As a result, he’s unsure how he will pay his own bills, which include mortgage, property taxes, insurance, employee wages, management fees, utilities and maintenance.

“We’re all a little bit tattered right now,” said MacDonald.

The NMHC warned that: “As more residents face job loss or furloughs and are unable to fulfill rent obligations, many owners/operators fear they, too, will not be able to satisfy their own financial obligations required to operate their properties.”

Avail indicated that just 4% of landlords have rent default insurance, and some 58% do not have credit options to pay expenses in an emergency.

“If tenants just stop paying their rents, can landlords absorb that? Most [landlords] work on thin margins, and there is not a lot of room to backstop. They may have capacity to get through April, but past April, that ability is probably very limited,” said Howard.

Landlords have asked Congress to expand the Coronavirus Aid, Relief, and Economic Security, or CARES Act to include help for landlords as well as tenants.

“We are happy to be part of the solution, but we can’t be all of the solution. The way the CARES Act is written, it’s very unbalanced,” said Andrew Chaban, CEO of Princeton Properties, a Lowell, Mass.-based property management firm with 7,000 apartments. “If the landlord has to put off mortgage payments, they might never get the money from their renters, but the mortgage payment never goes away. That puts the landlord in a quandary. We want to do the right thing as an industry, but putting that anvil on our shoulders, it’s just shifting the burden from society onto landlords.”

While some large cities including New York, Washington, DC, and Los Angeles, and some states have placed a moratorium on evictions and foreclosures, they have not done so for renters. People who fail to pay rent not only fall behind on their financial obligations but also accrue late fees.

For example, Pamela and Rob Russo were unable to pay the April rent on their home in Barnegat Township, N.J., after he lost his job. They have been unable to receive a payment postponement or have late fees waived.

“We still have to pay it,” Pamela, a nurse, said. “I think they should put it on hold for a little bit like they are doing it for the mortgage companies. We are going through it, too. I’m an essential worker, I go to a hospital and work on a front line and I am getting no help.”

Tenant advocates have asked New Jersey’s state government to offer financial help to cash-strapped renters.

“We need the governor to do something. We need [the legislature] to do more," said Matt Shapiro, president of the New Jersey Tenants Organization. "Tenants should not have to pay the full rent. We’re not out to put landlords out of business, tenants and landlords need to work together. We think the state should find ways to help those landlords.”

The average two-bedroom rental in New Jersey is more than $1,500 per month, the sixth highest figure in the country and well above the national average of $1,194. Almost one-half of New Jersey’s renters pay more than 30% of their salary on housing.

Renters account for about 35% of the state's 3.3 million housing units.

Some tenants and their advocates have called for rent strikes during the pandemic.

A national organization called RentStrike2020 has put out an online petition seeking rent relief across the nation.

“Our initial demand is simple: every governor, in every state, must do what is necessary to ensure a two-month freeze on the payment of rent, residential mortgages, and utility bills (including sanitation, power, water, gas, and internet services) to allow working families to do what is necessary to prepare for the difficult social measures required to flatten the outbreak curve,” the petition read.

New York State is also mulling a bill that would forgive rent and mortgage payments for 90 days.

"We need to take urgent and critical action now to suspend and forgive rents for people who are in need of assistance during the pandemic," said Senate Deputy Minority Leader Michael Gianaris, D-Queens, who co-sponsored the legislation. "The time has come where the paychecks have stopped coming."

Susanna Blankley, campaign coordinator with the Right to Counsel NYC Coalition, said she expects rent strikes to proliferate in New York City, now the U.S. epicenter of the pandemic.

“We have to cancel rent, and if the governor isn’t going to do it, we have a huge base of people ready to organize,” she said. “If we have thousands of people who couldn’t pay rent April 1, we’ll have millions in May.”

Rent strikes have also been called in California and elsewhere.

Jeff Cronrod, who represents the American Apartment Owners Association, the landlord trade group, said most landlords are willing to be flexible.

“We polled our members and close to 80% are willing to discuss or give forbearance, they understand the problem,” he said. “It’s appalling to me, in an age where we should be working together to solve an international global problem, to say ‘let’s bring down the banks, let’s bring down the landlords, let’s bring down the government.’”

Eric Sussman, a professor in accounting at UCLA who’s also a managing partner of a real estate firm, thinks as the economy worsens, more renters will forego payments.

“If renters are truly able to pay and decide not to, that’ll lead to far greater problems,” he said. “If every tenant says screw it, we can have systemic collapse that can result in additional job losses, longer recovery, and a worse outcome.”