Does Paying Rent Even Matter? The Relationship between Rent Payment Moratoriums and Asset Pricing on Major European Markets

Property investors generally rely on rent payments to meet their property-level debt service requirements. However, due to the Covid-19 pandemic, a majority of European countries have adopted rent moratoriums or passed legislation to protect non-paying property occupants from eviction. Following, this paper investigates the relationship between public policy on rent payments and real property asset pricing in three major European housing markets (Amsterdam, London, and Paris). Through a mixed-methods methodology, the paper aims to determine if there is a clear relationship between contemporary policies surrounding rent collection and investors interest in properties within Amsterdam, London, and Paris, as reflected by asset pricing. The paper will rely on quantitative data from the Real Capital Analytics property transaction database to determine changes to housing property prices following the Covid-19 pandemic and identify investors active within each city to interview for the qualitative portion of the project. The qualitative portion of the project will showcase in-depth interviews with investors active within each property market, focused on their perceptions of rent and tolerances for non-payment of rent when it comes to purchasing real property assets. Ultimately, the paper aims to contribute to real estate and urban scholars understanding the role of rent payments within investment decision-making – and more specifically, how investors see rent payments (or non-payment of rent) within their property-level investment decisions.