Renter credit remained steady during Q1 2010, according to the Multifamily Applicant Risk Index (MAR Index), derived from CoreLogic SafeRent’s statistical screening model and database of transactional data on more than 6 million apartment units.
The Q1 2010 MAR Index, which includes studios, one-, two-, three- and four-bedroom units, was 98, which is unchanged from Q4 2009 and shows similar applicant traffic during the slow volume periods of those quarters. Compared with Q1 2009, the MAR Index is slightly lower at 98 compared to 99.
“Following a bad year for jobs, the absence of a major falloff in credit quality in Q1 is good news,” says Jay Harris, VP of Business Services at CoreLogic SafeRent. “Operators have adjusted their credit criteria slightly downward over the past two years as they realize that the storm in the economy is not resulting in a substantial nationwide falloff in the credit quality of renter applicants. Steady applicant credit quality means apartment operators taking appropriate deposits can continue to relax their credit criteria slightly, thus improving their demand for available units during the busy season. Where they are using a statistically validated scoring model, operators know they are optimizing NOI by taking a minimal amount of incremental credit risk in adjusting their criteria.”
Markets with the leading increases in the MAR Index (which reflect improving resident quality) were Philadelphia-Wilmington-Atlantic City; West Palm Beach-Boca Raton, Fla.; and Portland-Salem, Ore. Markets with the leading decreases were Austin-San Marcos, Texas; Sacramento-Yolo, Calif.; and Detroit-Ann Arbor-Flint, Mich. Visit www.saferent.com for details.