The Eviction Moratorium – a Catch 22


Filed under: Market Comentary


One significant catch-22 we’re facing with COVID-19 and everything else that is going on right now in the economy is the eviction moratorium.

Eviction Moratorium Thru the End of 2020

It was announced earlier today that the Trump administration has pushed the eviction moratorium out to the end of the year. They did add some additional details about who’s eligible for the extend moratorium – people need to prove that it’s a hardship. If you can prove these things, then you can’t be kicked out of your house… even if you can’t pay your rent.

Two Sides to the Coin

Obviously, there are two sides to this coin. On one hand, these people are out of work due to no fault of their own. So, we need to have some level of sensitivity towards that. On the other hand, is an investor who is not an evil human doing something wrong. They are creating housing for people that can pay their rent – because their livelihood is reliant on it.

It’s a really difficult situation! From a pure mortgage/real estate perspective, it feels like it’s going to have some deep cuts. We can see the humanity in the situation and hate to see families kicked out. It’s a challenging situation, and another example of the fact that there are no easy answers in the current circumstances.

Long-Term Effects

The fallout from that is going to be quite wide-spread. I’ve been talking about what is going to happen with real estate – this situation is going to lead to things like a consolidation of households. If people can’t pay their rent, then they will move in with family.

What impact will that have on the market? It will be interesting to see what happens over time. But we are all feeling the concern about people being told from the federal government that it’s ok to not pay their rent.

I’d love to hear what you have to say about this! Comment, share, and reach out to me any time for a conversation. This is an important topic that we need to be talking about.


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