18% of US renters are four months behind on rent! The average amount owed including utilities and late fees is $5600 per rental. There are about $10 Million renters behind, so the total looks to be about $57.3 Billion.
Of the proposed $1.9 Trillion stimulus plan by the Biden administration, $25 Billion is slotted for rental relief. That plan has not passed, and there are signals that some on both sides of the aisle are thinking its price tag is too steep. In December, there was a $900 billion dollar stimulus package passed that already had $25 Billion for renter and home owner relief.
To put a little "perspective" here--during the great recession/housing crash, there were 7 million home owners that lost their homes over a five year period. We now have 10 million renters behind on rent. I can only assume that some of the owners of these homes will also be that far behind on their payments, because the owners need the rent money to pay the mortgage.
Looking at the headlines this morning, I took note of how bright the outlook is that is being projected for 2021.
Let's have a 30,000 ft fly-over look at the our present situation. We have record low inventory, record low interest rates, rising prices and rising demand. The Covid virus is still in the forefront stifling growth with lockdowns, mask mandates, and supply chain interruptions. On the national debt stage we are spending Trillions and projecting to spend Trillions more to "stimulate" the economy. On the national legislative stage we are looking at a return to stricter regulatory "lock downs" of the markets.
We are at a place where any number of factors could be a tipping point in the housing market. In the coming months we will most likely see a rise in the interest rates and a rise in the foreclosure market. This is looking like closer to the second half of 2021 or early 2022.
One benefit of having ridden the real estate rollercoaster starting in 2004 is having the benefit of a bit of perspective. Merriam-Webster.com defines perspective as : the capacity to view things in their true relations or relative importance. One of my jobs as your Realtor is to bring you the truth and keep current events in perspective. No the sky is not falling but there look to be indicators, shall we call them red flags, signaling a harsh change in the market, shall we call that a rip current, sweeping in faster and stronger than you might expect.
“Perspective.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/perspective. Accessed 29 Jan. 2021.
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