The end of the recession has been good for the multifamily industry—and judging by their credit scores, also for apartment residents.
According to a TransUnion analysis, 26.2 percent of the 775,000 apartment residents who moved in the second quarter of 2009 had a credit score of 660 or above in the year after the move, while 38.6 percent of the apartment residents who moved in the second quarter of 2015 had such scores in the following year.
The 2015 resident cohort was twice as likely as the 2009 cohort to open a new credit card by the middle of the following year—28.7 percent versus 12.4 percent, respectively. In addition, 17.2 percent of the 2015 cohort took out an auto loan in the year after the move, compared with 9 percent of the 2009 cohort.
The apartment resident pool has also aged overall since 2009. Apartment residents younger than 25 made up 22.6 percent of all renters in 2009, but that percentage dropped to 20.3 percent in 2015. Meanwhile, apartment residents age 45 and older grew from 23.5 percent of the renter population in 2009 to 31.3 percent in 2015.
“Our findings indicate that we are not on the cusp of rental affordability issues, as the vast majority of renters do have some excess liquidity once their monthly debt service obligations are met,” said Mike Doherty, senior vice president of TransUnion’s rental screening solutions group, in a company press release.