Imaginary Roommates Don't Pay Rent

A quick Google search for the terms "apartment" and "doubling up" gets you about 20,000 hits. Quite a few of those results are articles that feature photos of amazingly wholesome-looking twentysomethings who have combined households to reduce their individual rent payments during today's recessionary times. (Those in the heavily-pierced and totally-tatted set apparently go the lone wolf route, regardless of finances.)

Each story also will feature a quote from a local apartment manager who will state how common the doubling-up trend has become of late.

What you won't see in the article are any reliable numbers that back up the supposedly widespread pattern of behavior. And that absence seems to reflect that such moves in actuality don't occur frequently enough to produce a noticeable impact on apartment market stats.

Sure, it's going to be tough for standard data collection efforts to detect the jobless cousin crashing on your couch, but it should be fairly easy to track the renters featured in the typical story. If a pair of people previously rented separate one-bedroom apartments and now are roommates in a two-bedroom unit, those moves would translate to falling occupancy in one-bedroom apartments and rising occupancy in two-bedroom floor plans (or at least a smaller occupancy drop in the two-bedroom options).

Across the 5.1 million apartment units that MPF Research surveyed nationally during 2009's 2nd quarter, however, occupancy was identical for one-bedroom floor plans and two-bedroom apartments. The occupancy performance was a scant 0.1 percentage point higher for three-bedroom units. Furthermore, occupancy in each of these floor plan options came down by roughly 2 percentage points over the course of the past year, with variation in the shifts from one unit type to another proving too small to be statistically meaningful.

Among the 64 markets that form the core of MPF Research's survey sample, there actually are two spots where occupancy since the recession kicked in at the end of 2007 consistently has been higher in two-bedroom apartments than in one-bedroom units. Those two locales are Orlando and Tulsa. And the reason for that would be ... uhhh ... uhhh ...well, really we don't have an explanation for that, but feel free to share your ideas.

So from MPF Research's perspective, the assumption that apartment renters double up in large numbers during a recession looks pretty bogus. But we'll be polite enough to remain quiet at the next industry conference where somebody says he expects a sizable lift in demand from the undoubling of roommate households once the economy starts to improve.

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