Turnover Rate Lowest in 20 Years
According to research from CBRE, the turnover rate in April, 2020 was the lowest it has been in 20 years. From an article in MultiFamily Executive:
More renters are staying in place due to the COVID-19 economic downturn, according to a new research brief from CBRE...
RealPage had earlier reported that turnover decreased from 47.5% in 2019 to 42.1% in April, which is the lowest level the nation has seen in over two decades. While turnover numbers typically rise each spring, they had declined this year due to stay-at-home orders and economic concerns.
According to the CBRE research brief, turnover numbers will likely rise in the coming months as leasing activity picks back up, but 2020 is anticipated to have lower levels than last year.
The article also highlights some differences between property classes:
As for market types, Class B and C apartment communities typically have lower turnover rates than newer developments because of the challenge to find affordable housing in markets where vacancy is low and rents are high. According to the CBRE research brief, Class A residents tend to move more because of more alternatives at newly built communities, rental concessions, and higher rates of migration due to new job opportunities.
Due to the COVID-19 pandemic, payment plans and eviction moratoriums for renters affected by unemployment are helping to keep the Class B and C renters in place. In past recessions when safety nets weren’t available, turnover rates were much closer among the different assets.