Look how many renter households are unable to pay their rent and are at risk of eviction:

The U.S. is currently under a national eviction moratorium that stops landlords from evicting tenants who do not pay rent until at least Dec.31^st, 2020. Even though tenants must sign a declaration form to their landlord stating they have lost income due to the coronavirus pandemic, some states have their own eviction bans on the books. Some offer more protection than the federal eviction moratorium, but many have let their laws expire.

Eventually, these tenants are expected to pay their back rent. Here is the million-dollar question: How are they really going to do that? If they cannot pay their rent now, how can they pay it in the future? Are things going to be better in January?

During the 15 weeks from mid-March to the end of June, Americans filed nearly 49 million new claims for unemployment benefits. 

In general, the eviction process can take anywhere from as little as two weeks in the fastest states to as long as three to five months in states where the process has to go through many more steps. Let’s just assume that there will be delays in the eviction process due to the number of cases all at once that will most likely happen.

By the summertime, we should start to see a large number of rental evictions along with many homeowners not being able to pay their mortgages. Many of these landlords who have not received rental payments by their tenants may be forced to sell their properties in a fire sale or short sale.

Those managing short-term rentals, such as Airbnb, maybe juggling multiple mortgages and most have suffered a major blow. Private lenders may require homeowners to make a lump-sum payment once the forbearance period is over. Fannie Mae and Freddie Mac borrowers will have a 12-month moratorium after the forbearance period ends to repay missed payments. Owners of Airbnb’s in desirable coastal areas may be forced to sell their properties for less than market value should they not recover from the economic fallout of the coronavirus.

There is going to be major supply flooding the market all at once in certain areas causing prices to drop significantly. This is where opportunities will come in. Just like trading stocks, we want to buy after a correction, but let us not try to peg the bottom either. We need to wait on the sidelines for the best deals to come in. Pay-tience!!