Fifteen months after the official start of the Covid-19 Pandemic, I’m still hearing the phrase, “when we get back to normal”. If “normal” means to have things the way they were before Covid-19, it may never happen.
There have been many painful things from Covid…just the deaths in the U.S topped over 600,000 as of June 2021. People missed out on weddings, funerals, graduations, and the list goes on. That being said, there have also been some positive things that came out of the last year. For instance, the people that were/are able to work from home were able to spend more time with their children and significant others. Many believe that they were more productive at home, and certainly want to continue. For some people and families, this last year has been a “honeymoon” of sorts. Rent relief, mortgage freeze (from foreclosure), and many are making more on unemployment than they were at their prior jobs.
Let’s look at the facts: More than 10 million US renters, or 14%, are behind on their payments. Unlike the foreclosure moratorium, renters who have not been able to keep up with their bills will be liable for the entire back payments unless the government steps in yet again. There are also millions of foreclosures “on hold”, with regards to the foreclosure process, and it looks like things are being pushed to the year 2022. If lenders are forced to wait until January of 2022 to start the foreclosure process at the earliest, we are looking at Summer 2022 for a flood of properties on the market.
What does this all mean? The supply of homes for sale will increase, while the interest rates will fluctuate with any and all economic news. Historically, a rise in supply leads to a decrease in overall sales prices, and we expect no difference in this situation.