Notice changes in application and rent recently?

Question

Maybe it's just me and around this area but it seems like the past few months the only people applying have awful credit and backgrounds like no where close to meeting the requirements, making properties sit way longer then they used too a few months ago. Also been noticing how many more people have been paying late the past year. Of course the economy is a lot worse which has a part to do but still. Anyone else seeing things similar in other areas?

Nathan Gesner · Answer

In my experience, it's returning to normal like it was back in 2018/2019.

Every market is different. With the economy in rough shape and everything costing more than usual, it wouldn't surprise me to see people tightening the purse strings and sitting tight for a while to see how this shakes out.

Bjorn Ahlblad · Answer

@Chris Geer our applicants are considerably improved. Some of it may be as a result of posting the basics right in the ad-no evictions, no felonies, income 3.5 times rent etc. We used to get flooded with unqualified folk and that has changed for the better for whatever reason. Hope the trend continues. All the best!

Kevin Sobilo · Answer

@Chris Geer, all real estate is local! What market are your properties in? There may be things going on locally that explain what you are seeing. Also, unless you have a substantial number of units what you are seeing may be anecdotal and not representative of any larger trends.

In my market (Scranton/Wilkes-Barre, PA), I have no seen any such changes. Tons of people needing rentals with migration from the east coast cities towards my market. Credit scores for the average working class renter has always been poor, but that is the least important indicator to me because many of these people haven't used credit enough for it to be representative of them. I've noticed no different in backgrounds.

I'm not sure what you mean by the "economy is worse". Stock prices for example don't affect the average renter's monthly budget. Incomes are up ~5% in the last 12 months and the unemployment rate is something like 3.7% (super low). The economy from an employment perspective is still so strong people still aren't even wanting to work because labor participation is still below pre-pandemic levels. So, many people don't feel they even need to work yet.