Today we’re going to talk about the real estate housing crisis and the newly enacted eviction protections – Enjoy! Sign up to Morning Brew for free today: http://cen.yt/morningbrewgraham2 Add me on Instagram: GPStephan
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Under the new eviction freeze, this encompasses ALL rental units until December 31st, and applies to all tenants who earn under $99,000 per year as a single person, or $198,000 as a married couple annually.
After reading through the entire memorandum, it’s become apparent that the REASONING behind this is that – as people move from their house into closer quarters, they risk getting the “the illness,” and then giving it to others – so, the motivation is for the health and safety of all of us, as a society.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2020-19654.pdf
The tenant must also self certify that they’re making timely partial payments that are as close to the monthly rental amount, within their means…so, if rent is $1000 per month and the most the tenant can pay is $200 per month – this memorandum says you should be paying whatever you can. This is rather subjective as to what’s reasonable to pay given the circumstances, but they leave that to you to decide.
The big glaring problem with this, however…is that – when this is over – rent is still due, at which point, we’re right back to square one, and even though this is a fix RIGHT NOW – it’s more like kicking the can a little further down the line, at which point – we’ll still have to deal with the exact same problem, but in the future.
From a numbers standpoint, a Harvard Study found that there are 43 million renters in the United States…and the National Multifamily Housing Council found that, overall, most tenants ARE still paying their rent, even after the unemployment benefit ended.
They collect data from 11 MILLION apartments every month, and as we can see…last year, about 96% to 97% of tenants have paid their rent in full by the end of the month. THIS YEAR, that’s hovered about 95% to almost 96%. Even as recent as August 27th, 92.1% of tenants have paid their rent in full…that’s only slightly below the 94% that paid rent in full by the same time, last month.
https://www.nmhc.org/research-insight/nmhc-rent-payment-tracker/
Now, keep in mind – this doesn’t count partial payments or payment plans – but, overall, as we can see – missed rent hasn’t dropped THAT much from the last year, BUT – the big change is that those non-paying tenants can no longer be evicted. That means, if we have 43 million renters – and 6% of them are not paying in full – that’s about 2.5 million renters who are behind on their payments and protected by non eviction, and that’s about 400,000 MORE than we had at this same time, LAST YEAR, pre-illness.
The GOOD news…or the silver lining here…is that we’re unlikely to see a “Wave of foreclosures,” because the vast majority of home owners have plenty of equity in their home if they decided to sell. This study found that, overall, only 6.2% of loans were under water.
https://www.nationalmortgagenews.com/news/mortgage-equity-report-in-second-quarter-2020-finds-fewer-are-underwater
If we calculate this into real numbers, there are 128 million households in the United States…and 60% of those have a mortgage. That means, 76.8 million mortgages…6.2% are underwater…and that gives us 4.7 million homes at risk of foreclosure, or 3% of all homes in the United States.
That’s why I believe this is UNLIKELY to lead to any type of catastrophic real estate collapse on a large scale, but it DOES mean that SOME people – both landlords AND tenants – would likely get hit VERY hard, and here’s what you can do about that:
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness@gmail.com
*Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available.
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Who wants to pay for someone else to own a house while they get kicked out after they pay the house off and you don’t keep the old house you then sell it and keep all the money.
What I don't understand is if rent non-payment evictions are freezed, why mortgage defaults repossessions are not.
Graham – your a wizard. Love how you leverage and dig through the data to come to your opinions and theses. Where are you getting this national housing data and what sites do you recommend using for research regarding these macro topics? Thank you!
Can you kick them out if their term is over?
Housing is way over commodified.
I own multiple properties and most of my tenants are paying rent thank God. I talked to my bank about forbearance and they didn’t say if it will effect my credit. Why would I mess up my credit because tenant can’t pay rent. Government as usual is screwing some people over and helping others. America is set up to destroy the middle class and makes it hard to want to invest in real estate or small business . Look at all the small business closing because they are not essential and the big box stores staying open. How many small restaurants will close and never open again. Wouldn’t it be crazy if we found out the cv-19 was all blown out of proportion and the death numbers are fake? Wouldn’t be crazy if this was all a scam for the rich to get richer and middle class to become poor? It’s not like someone is benefiting from the crisis, right?
it's only bad for scammers like you
So you want the government to genarentee your rent payment?
skip to 3:22
You need to pay cash for a rental.
That was a nice brief for landlords.
Housing crisis happens when people listen to CNN and videos like this, causing panic
Hey Graham! Something I have been wondering about and I don’t know if you have a video on this. When investing in real estate, do you stay in the same state or you search for better opportunities in different states? I’m guessing the answer can be related to each state rules and taxes? Which states are the best?
Thanks!
It’s called a UBI. A 1000.00usd UBI would have been intelligent for congress to pass in March. Instead of rent forebearance. Nope. The care act was loaded w goodies for corporations and the oligarchs.
My Morning News
Thumbnail looks like thirst trap
Will rent go down in San Diego by Jan 2021
Counting on the housing market correcting in the Spring so that I can buy my first home.
I wonder how many homeless people are suffering from the virus and died of it. We know of the seniors and those with co-morbidities.
What’s so delicate? Ignorance believe that money just appears like opening a faucet…. lol . When your agreement to give away your income for free while only %20 is on your products … who’s dunce is missing? Pay cash the first time . Can’t afford it. Quit running around with the joneses. You can’t scam fast enough like them people
This guy says absolutely nothing. Pure ad revenue clickbait. Soulless.
Did you hear the sickening news about "Uber for evictions" Civvl?
Are landlords the only ones who expect no risk from their investment? Like none whatsoever? They are all too happy to kick people out shown by how quickly they scattered to increase eviction before this freeze went into effect or people were aware of their rights, and while the tenants have lost basically everything else, the landlords are unwilling to take on any risk of their investment. Plus the banks are not willing to work with landlords at all? As always the little guys will get screwed over and the bigger landlords and businesses will gobble everything up. All the government had to do was literally give people money instead of the bug businesses and then people would have some t it on all this sort of stuff but the government is in the pocket of oligarchs
If you want me to start Exposing people on videos starting with Graham Stephan Like my comment. I dont like making videos, but guys like Graham Stephan that seems legit and nice need to be exposed to. These guys sort of piss me off the most because they try to walk the line of I'm good. Infact they are not as good as you think they are. I even know things that even coffee zilla has not even mentioned yet. I care about others and I care about the truth and the whole truth. Graham Stephan is just one of many that might seem nice but is not that nice regarding really helping others. They will all be exposed and might need more than one video per person. So give me some feedback and I will respond back. Have any questions I will answer right away as soon as possible. I just hate half fake people or fake people that lie. If you want to know specifics about any youtuber including Graham Stephan I have no problem exposing him in a message either.
people buying houses at these high prices are fooked in no small way.