August 1st Rent Payments Decline Following Benefits Running Out

  • August 1st rent payments are slightly above the pre-COVID average.
  • Percent of renters who paid full rent has hit a new post-COVID low for first-of-month.
  • Class C rent payments saw a healthy boost after a shaky start in July.

Negotiations about the extension of federal unemployment benefits have dominated the headlines lately, as the ability to afford rent for millions of Americans hinges on the decision. After the $600 weekly bonus came to a halt at the close of July, it’s time to analyze how it’s affected August 1st rent payments.

In July, concerns grew more serious about renters being able to afford rent as signs of financial insecurity began to deepen. The multifamily industry has also been focused on the potential “eviction tsunami” after the federal eviction moratorium expired, enhanced unemployment assistance ran out, and rent payments began to slip — especially among Class C residents.

With talks of an extension for the boosted benefits at an impasse, how are renters upholding their rent obligations on August 1st?

Last Round of Benefits Provide Stimulus for August 1st Rent Payments

Overall, first-day August rent payment behavior has held relatively stable, but signs of financial desperation are emerging.

While July 1st rent payments remained steady amid growing economic uncertainty and a resurgent pandemic, August 1st rent payments have held 1 percentage point above the pre-COVID average at 19%. This is encouraging considering federal unemployment benefits ran out at the close of July, however, it’s likely that the final round of benefits have helped many residents afford August rent.


Without the extension of bonus funds, the ability to pay rent will probably weaken through the August grace period. This negative movement will persist through the month, emphasizing the increasingly dire situation if Congress fails to approve additional assistance.

In previous months, we’ve observed a pattern of first-of-month rent payments coming in relatively high, but then tapering off through the grace period. On August 1st, we’re seeing that the percent of renters who paid full rent on the first is much lower than the previous post-COVID months. This could be due to August 1st landing on a weekend, but also points to obvious strain among many jobless or financially insecure renters.

Federal Stimulus Package Remains up in the Air, Putting Many Renters in Jeopardy

Pending the final decision on whether to extend federal unemployment relief as well as how to structure the stimulus, search trends demonstrate mounting fears among the unemployed who have lost access to direct financial assistance.

Interest in “rent assistance” has seen a steady increase over the course of the pandemic, reaching its peak shortly before sunsetting in the end of July.


This trend is also apparent for the search term “benefits extension,” in which interest reached it’s all-time high the same week that the bonus lapsed. From the initial spike post-COVID, interest has surged more than 230% since, again stressing the need for Congress to agree on a new relief bill to support those who have lost their jobs.


While the unemployment picture seemed to be improving back in June, over one million jobless claims were filed for the 19th consecutive week in mid-July, with 50 million total out of the workforce. To cushion the fall for struggling renters, local and state governments established emergency rent assistance programs, many of which have dried up.

Class C Rent Payments See Slight Recovery

Class C residents are considered to be most vulnerable to job loss during a recession, and the lack of unemployment assistance only further strains their financial security. In the month of July, Class C renters showed signs of financial distress.

This month, Class C properties saw a 1 percentage point increase in first-of-month rent payments since July. Class C rent payments now sit 2 percentage points higher than the pre-COVID average. These numbers will taper off after the first, however, as more residents reckon with reduced unemployment benefits.

Class B properties, on the other hand, have tapered off each month since May, while Class A rent payments have unsurprisingly held strong.

August-1st-rent-payments-percent-of-renters-who-paid -full-rent-by-class

California Slips More as Texas Holds Steady

In California, rent payments continue to weaken, although they’ve dropped only 1 percentage point below the average. Nonetheless, the percentage of rent collected in California reached its lowest, which may be partially due to strict social distancing measures and business shutdowns. Texas is still in recovery mode with rent payments dipping 1 percentage point below last month, but holding slightly above the average.


In Los Angeles specifically, somewhat delayed rent relief efforts have magnified the affordability crisis, despite providing the nation’s largest relief program. Dallas reflects state-level data, showing slight signs of recovery after a 5 percentage point drop last month. This could be due in part to a Dallas County assistance program that was reinstated for a limited time before the conclusion of boosted unemployment funds.


Pending Federal Benefits Extension, August Grace Period Remains Uncertain

There’s no question — with the stalling of unemployment benefits and no final say on the extension, renters will struggle to pay rent. If the HEALS Act does pass and weekly benefits are reduced to $200, it remains to be seen whether the stimulus will be sufficient for renters to prioritize paying rent.

Regardless, the rental housing industry needs to continue advocating for rent relief in order to protect their residents. This means pushing for more comprehensive measures to avoid a potential ‘domino effect’ that would be catastrophic for both renters and multifamily owners.

Check back soon for our rent payment analysis on the August grace period (traditionally the first five days of the month).

Important statistical note: Despite the measured payment fluctuations based on the sample set, the variance is within normal statistical range. In other words, the changes are not necessarily significant enough to attribute specifically to COVID-19 versus normal fluctuations expected across the data set. Please reference full Methodology below.


Rent payment data is actual transactional data sourced from integrations with property management systems in the multifamily industry.

Analysis includes a 105,070 unit sample from 1,029,428 live units under management by LeaseLock clients. Data is nationwide, representing over half of the NMHC Top 10 property managers in the country and all asset classes (A, B and C). Asset class composition: class A (36%), class B (55%) class C (9%).

All data has been anonymized to remove personally identifiable information for renters and property managers.

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