Rental Performance Report for December 2022

Wondering how on-time rent payments are faring across the nation? Take a look at Chandan Economics & RentRedi’s Independent Landlord Rental Performance Report for December 2022.

Key Takeaways on Rental Performance for December 2022

As noted in Chandan’s report, here are the key takeaways:

1. The on-time payment rate in independently operated rental units declined by 156 bps between November and December, falling to 81.2%, reaching a 2022 high.
2. National on-time payment rates have now held above 81% for three consecutive months. This is the first in the Chandan Economics-RentRedi tracking.
3. December’s full payment rate is forecast to land at 90.7%.
4. The on-time payment rate remained higher than that of units located elsewhere for the second consecutive month, landing at 81.7%
5. 2–4-unit rental properties and SFRs had the highest on-time payment rates among sub-property types in December, at 82.3% each.

Maintenance and Expenses

There were major maintenance issues and expenses during the reporting period. December maintenance performance is easiest to understand through the lens of operating costs, unexpected repairs, and the timing of seasonal work. In a month like December, major expenses often rise when landlords must respond to weather-related issues and routine year-end upkeep. Heating service calls, plumbing repairs, appliance replacements, lock changes, and general unit preparation can all create concentrated cost pressure, especially when repairs are urgent or require outside vendors. For independently operated rental units, these expenses can have an outsized impact, as even a small number of major repairs can materially affect monthly operating performance. Tracking maintenance activity during the reporting period helps distinguish normal upkeep from larger one-time issues that may distort costs. Routine maintenance tends to support property condition and tenant retention. Emergency repairs can signal unexpected breakdowns and lead to higher labor or parts costs.

December is also a useful month for reviewing whether expenses were driven by short-term operational needs or by broader property condition concerns that may continue into the next reporting period. Comparing the type, timing, and severity of repairs can help identify whether the month’s maintenance burden was typical for the season or unusually heavy. That distinction matters because recurring issues, such as repeated HVAC service or ongoing plumbing problems, can indicate assets that may require more substantial investment. Likewise, a spike in turnover-related expenses can indicate leasing changes that temporarily increase the cost of keeping units market-ready. Even when maintenance does not directly affect rent payment performance, it still plays a major role in rental operations by shaping net income, property condition, and long-term portfolio stability. A clear overview of maintenance and expenses provides a more complete picture of how the portfolio performed in December, beyond collection results alone.

Occupancy and Vacancy Rates

Occupancy and vacancy rates offer a clear view of how well rental properties were filled during the month. These metrics help readers understand whether units were being absorbed efficiently, whether empty units were creating pressure, and how stable rental demand appeared across the portfolio. The list below breaks down the month’s occupancy and vacancy picture into five focused points.

• Overall Monthly Occupancy Rate: It indicates how many rental units were occupied during the month and provides readers with a quick read on portfolio stability. A higher occupancy rate usually indicates steady demand and consistent unit leasing. A lower rate can indicate higher turnover or slower leasing.
• Vacancy Rate and Empty Unit Pressure: The vacancy rate shows the share of units that remained unoccupied during the month. This matters because even a modest vacancy can affect how operationally stable a rental portfolio feels. Higher vacancy may point to slower leasing, delayed move-ins, or tenant turnover. Lower vacancy usually indicates stronger demand and better retention.
• Occupancy by Property Type: Occupancy often varies by property type, and that variation can reveal where demand was strongest during the month. Single-family rentals, small multifamily buildings, and larger multifamily properties may each experience different leasing patterns.
• Short-Term Vacancy Patterns: These patterns help explain whether empty units were part of normal turnover or a more persistent problem. A unit may be vacant briefly while repairs are made, while a lease is being renewed, or while a new tenant is moving in.
  Occupancy and vacancy together provide a simple view of renter demand during the month. High occupancy paired with low vacancy usually suggests that units were absorbed well and leasing conditions were healthy. Rising vacancy rates can indicate weaker demand, slower tenant turnover, or greater friction in the leasing process.

Together, occupancy and vacancy figures show how strong renter demand was during the month. High occupancy and low vacancy usually suggest that units were absorbed efficiently, while rising vacancy may signal weaker demand or slower leasing activity.

Rental Income Trends

Rental income trends for December 2022 point to a generally stable but slightly softer revenue environment than the prior month, with the main story being how smoothly income held up despite a modest decline in on-time payment performance. Because rental income is shaped by how consistently tenants pay and how much of the portfolio remains productive during the month, the reported December figures suggest a market that continued to generate strong rent flow overall, even as the pace of collections cooled slightly from November. The on-time payment rate fell to 81.2%, down 156 basis points month over month, which implies that a larger share of rent may have arrived later in the billing cycle rather than disappearing altogether. That kind of shift matters for income analysis because it can create short-term fluctuations in cash flow without necessarily signaling a structural decline in rental demand or lease quality.

At the same time, the fact that national on-time payment rates remained above 81% for a third consecutive month supports the idea of a relatively resilient income base heading into year-end. The forecast full payment rate of 90.7% further reinforces that most of the expected December rental income was still likely to be realized, even if some of it arrived after the on-time window. When looking across sub-property types, the strongest on-time payment performance from 2–4-unit properties and single-family rentals, both at 82.3%, suggests that smaller independently operated assets may have experienced slightly more dependable income timing than other segments. The comparison with units located elsewhere, where the on-time payment rate was 81.7%, also indicates that rent income remained comparatively strong in the independently operated segment. The rental income picture appears to reflect mild month-to-month fluctuation rather than a sharp downturn: income collection stayed elevated, expected full receipts remained high, and variation was concentrated more in timing than in total projected revenue.

Rent Collection Performance

The most useful lens is tenant payment behavior: how many renters paid on time, how that changed from the prior month, and which property types performed best:

• On-Time Payments: December’s on-time payment rate fell to 81.2%, down 156 basis points from November, but the broader picture still looks resilient. Holding above 81% for three straight months suggests that most tenants continued paying within the expected window. The decline matters, though, because it shows some softening in payment timing. That kind of shift can affect cash flow planning even when total rent is still likely to be collected.
• Payment Timing Appeared to Shift Later in the Month: A lower on-time rate can create short-term strain for owners who depend on rent arriving quickly to cover obligations. It can also indicate holiday-related delays or temporary budgeting pressure among tenants. Tracking how quickly late payments convert to full payments gives a better view of collection quality than on-time rates alone.
• Full Payment Expectations Remained High: Despite the dip in on-time payments, the forecast full payment rate for December was 90.7%, which signals that most expected rent was still likely to be collected. This helps separate delayed payments from missed payments. A strong full-payment forecast suggests the collection issue was more about timing than about loss. For property owners, that means year-end cash flow may have been uneven, but overall rent recovery remained solid. Reviewing both on-time and full-payment rates provides a more complete picture of tenant payment reliability.
• Smaller Properties Showed Better Payment Performance: Among sub-property types, 2–4-unit rentals and single-family rentals both posted the highest on-time payment rates at 82.3%. That suggests smaller independently operated properties may have experienced slightly more dependable tenant payment behavior in December. This matters because collection performance can vary by housing type, even within the same market. Higher on-time rates in these segments may reflect stronger tenant communication or different renter profiles. Comparing sub-property types helps identify where collections are most consistent and where extra follow-up may be needed.
• Independent Rentals Outperformed Other Units Slightly: The on-time payment rate for independently operated rental units was 81.7% when compared with units located elsewhere. That edge is modest, but it still suggests stronger payment behavior in the independent rental segment.

These are rent collection performance and payment behaviors by tenants. The most important signal is that tenants still appeared likely to pay, even if some paid later than expected.

Year-over-Year and Month-over-Month Comparisons

Looking at December against November helps reveal short-term changes in payment behavior, while comparing it with the same month in the prior year helps separate seasonal effects from structural shifts in landlord performance. In December 2022, the on-time payment rate declined from November to 81.2%, a 156-basis-point drop, suggesting a modest month-over-month softening in payment timing. That decline matters less as a standalone figure and more as part of a pattern: national on-time payment rates still remained above 81% for three consecutive months, indicating that the dip did not break the broader stability seen in the final quarter of the year. It also makes it easier to understand whether December’s results reflect typical year-end behavior, such as holiday-related payment delays, or a more persistent change in tenant payment habits. Year-over-year comparisons serve a similar purpose by placing the current month within a longer performance cycle. Even without treating the monthly result as dramatic on its own, comparing it to prior periods helps highlight patterns such as recurring seasonal strength, recurring end-of-year softness, or gradual improvement in overall collection reliability.