Evictions Moratorium has ended! What does the future hold?

This is episode number 152 of The Homeowner's Show. Whether you're DIY or looking to hire, we're here to help you find the best information and options for you and your home. My name is Kevin Hadgett. Here with me is Craig Williams.

Hello, hello, hello, and welcome to The Homeowner's Show. We're glad that you could be with us, even though we're Not really together.

We're not together.

No, not at all.

Not at all. So times are weird.

Yeah, many things are amiss. There we are. We're up on the screen now. Hey, how's it going, Kev?

It's going— it's weird, man. Life's weird. Yeah, just the way it goes, man.

Do you want to explain to everyone what's going on, or should I? Because I feel— I feel like I was at the genesis of this situation.

You were.

Um, but it's, it's definitely hit closer to home for you.

Yeah, so, um, a little over a week ago, a week and a half ago or so, um, a group of children went to camp and said camp, uh, was fun. You were at the camp. I was not.

I was at the camp. That's why it was fun.

Yeah, I guess so. Um, my, uh, my wife and oldest was there, and, uh, at the camp COVID decided to show up. So, um, people left camp, came home, and my wife, uh, figured out a way to contract COVID. So we've been, we've been at home kind of quarantining. Now we've actually been out, gone. We didn't actually get a positive test until a few days ago. But, um, anyway, we were, uh, we're surviving and everything's good. I mean, she's not, she's not in, in any real danger at the moment or anything. But thankfully, you know, the rest of us are good and haven't had any issues or anything. But, um, that's why I'm not at your house, at the studio right now. It's just, uh, trying to,

you know, make safe choices.

So you locked her in her room?

No, I locked her in my room.

You Rapunzeld her.

Yeah, it's, it's, it's, it's our room, but I feel like I got evicted, which is kind of funny. We're gonna talk about that later.

But oh yeah, we're talking about evictions. Yeah.

So anyway, but no, everything's fine, really. I mean, I'm just gonna work from home this week and play dad for a while.

That'd be fun. Did you send— I know you had some other folks in town. Did you send them home?

Yes.

Okay.

They're gone. And, um, yeah, it's just the family right now. And so we're surviving and everything's fine, really. I mean, it's just, uh, one of those deals, man, when— right whenever you think, uh, things are kind of getting better, then you have a little, a little mini spreader.

Yeah.

And, uh, you know, we've got multiple people that we're friends with who have children who have been, um, you know, gotten a positive result and those sorts of things. I know you're testing like every day right now, right?

Yeah, I've had 2 tests so far.

Okay.

Both negative. I mean, I'm not feeling bad. I just know that I've been around people and want to make sure that I'm not, you know, potentially spreading this thing to other people. So yeah, but you know, can't get that— can't get that 2-week vacation, man.

No.

One of these days.

No, you don't need it. You don't need it. That would be That would be bad for you. I mean, I can work from home. You, not so much.

Not so much. Not so much.

Yeah.

So, well, I want to let everybody know I've got a DIY project in the pipeline right now that I'm excited to share with everybody once it works, or once it's completed. I say works because it's something I've been trying to work out on my property for a while. I think I may have, you know, said Alibaba just right to do my pool heater. Oh, I think I— that's— I may have finally figured it out without having to spend 3 grand.

Oh my goodness. So getting it figured out is huge. Because what most people probably don't understand, because they've not ever been to your property, we've talked about it plenty of times.

You're all welcome. Come on over. Yeah, yeah, yeah.

Um, but your pool is in the party barn, which is under a roof.

Yep.

All the time.

Yep.

Which means your pool is never seen sunlight. Never seen sun. So it's always cold.

Yeah.

It's— I mean, even, even in the middle of the summer, it's 100 degrees outside, you get in your pool and it's like, oh yeah.

I mean, even if, even if it were like a normal temperature, like know, like 84 degrees or something, you know, like, which I think most outdoor pools who exist in like our summer temperatures hang out at because they, you know, experience some amount of shade from trees and different things like that. Even if it were at 80, you know, 84 degrees in the shade, it's still gonna feel a lot cooler than it would in the sunlight. Because you don't have the sunlight on you. So That's the downside. The upside is the complete lack of melanoma in my children. So, you know, you got to pick your battles.

Yeah, it is what it is. I mean, you know, I think that it's great because you don't have to worry about sunscreen. There's a lot of really good pluses. Yeah, but you need a heater.

Yeah.

So, so what have you done?

Well, I don't, I don't want to, I don't want to reveal too much.

Um, okay.

Uh, but my— so the initial thing that we did is we did a, a roof solar heater, which is essentially a bunch of skinny black pipes that you roll out. It's, it's almost like a cloth that you roll out on the roof, and then you attach it to your pool pump. It pumps the water up through the pipes, and, and then that will heat the pool. And, and that does work. It just doesn't If you don't have a good timer on your pool, which I don't, again, that's another issue. We're working on that one. You have to go and manually turn it on and off, and hopefully you're doing it at the heat of the day.

Mm.

And as you, you gotta think, I mean, if you had a 15,000-gallon pool and you're pumping water through tiny black tubes, it takes a lot of heat to heat that water up and then continuously do it. know, as it's getting reintroduced to the pool, it's cooling off. So it's, it, it's a long process.

Yeah.

Um, yeah, my second attempt at sort of DIYing this was I got one of these cheap Chinese outdoor, uh, showers, water things. Um, and the issue with that has been that the pool pump and the system, the way that it works doesn't generate enough pressure to push water through it efficiently.

Okay.

So it works great. I mean, like if you just hook it up to the hose and you turn it on, it— the propane kicks in and it heats that water up like nobody's business.

Sure.

Now getting that amount of pressure out of the pool system to recirculate the water is a whole other issue. But anyway, in weeks to come, hopefully I will, I will have some updates about that and hopefully we'll get it solved. Preliminary tests are promising. Let's put it that way.

Okay, cool.

So, but tonight what we, what we want to talk about and wax eloquently is something major that happened in the United States here on Saturday. Are you aware of this?

Yeah, so yeah, I am. We probably need to, uh, do some setup, uh, before we get to that, um, and, and kind of— because some people, if you're a homeowner out there, there's a good possibility you're kind of unaware of what has even happened, and then now what is being retracted basically at this point.

Well, and maybe not, because it's not It wasn't just a moratorium for renters.

Well, it was, it was primarily geared toward renters.

Yes.

Correct.

Yeah.

So, so they're back, back whenever, you know, COVID began and people were losing their jobs. And people were just trying to figure out how am I going to pay my rent. The government put a moratorium on that basically said, look, you, you can't evict anybody right now. because they can't pay their rent. That's illegal. We're not gonna allow you to do that because look, we're in a weird situation. Times are weird. And we're just not gonna let you do it. And we, man, we heard some crazy stories. You remember that story of the deal out in California? Which one was that? The one where a home buyer owner sold their house, closed on the deal. Mm-hmm. Everything was completely done. And then they

refused to leave the house.

Yes, I do remember that. And the new—

and the new homeowners were going, look, you sold us your house. It's now our house. The money's in the bank. The money's in the bank. We, we have your house. It's, it's our house now. It is not your house. Get out of my house. And, uh, the previous homeowners who just sold their house were going, oh no, look, there's a moratorium. You can't evict us. And they're like, we're not renting this house to you. They're like, well, this is the only house we have, so it's illegal for you to push us out of the only, you know, roof covering that we have here. You can't do that. And it became really ugly.

Yeah. So, so yes, there is— there was a moratorium on evictions.

Right.

There was also a moratorium on foreclosures.

Okay. And that's the— that's the part I wasn't— I wasn't thinking of when you were asking that question.

And so both of these collided on Saturday.

Right.

And so this is according to The Washington Post, an article they put up yesterday. It says over 2 million homeowners are delinquent on their mortgage and billions in federal aid has yet to be distributed. Yeah, that's incredible.

It's, it's really incredible. And one of the things that's bizarre about that, to me at least, is that they're basically saying, look, there are financial aid options out there for you. But good luck finding them.

Yeah.

And even if you find them, there's no guarantee you're going to get the money.

Right. And I was just flipping through this article and they've already posted a correction to the article.

Yeah.

So here's, here's one of the corrections. And I think, I think this is an important distinction. It says that this, this story originally reported that 1.5 million homeowners are at least 3 months behind on their mortgage payments. Okay. That's actually true. Okay.

Sure.

That one, at least 1.5 million homeowners are at least 3 months. So like, it's not, you know, the, the initial part of the story said that there was over 2 million homeowners that are delinquent. Okay. So that could just be one, one month. What it's saying is that there's 1.5 million that are at least 3 months behind on their mortgage. without a forbearance plan. The correction is the story has been corrected to note that those homeowners are not in foreclosure yet.

Okay. So, but they, but they can be put in foreclosure.

As of Saturday. Yeah.

Now.

Yes.

Yeah.

And, and so to, to add on to that, the interesting part about that At least— so this is, this is a story put out by ABC 13, which is a local Houston affiliate of ABC.

Right.

And here's what it says. It says that $45 million remain in program helping renters facing eviction as eviction moratorium ends.

Hmm.

Okay. Wow. So, and to be okay, so that's different from foreclosure. So we're talking about 2 different things. We got eviction and we got foreclosure over here. But here in Houston, there's at least $45 million sitting in reserve in order to help people who are facing eviction because they can't pay their rent.

Yeah. So, so the distinction here is people that are in foreclosure Own their home.

Yes.

People that are, are, you know, potentially being evicted are renters, right? They don't own their home. So that's the difference in the terms. Um, but again, we're talking about a problem here where these people need the money and it's sitting there available, but it's not being passed out. Now, part of the question I've got here though is Is that because people don't know they need to go get it, or did it— they don't know it's available, or they're just really slow in, you know, getting it to people?

I, I, I— that I don't know. That's, that's the weird part. And right here, here's the— here's my issue with the whole situation, is the government made it really well known that there was gonna be a moratorium on evictions and foreclosures. And in fact, when COVID started, they even shut the court system down.

Yeah. You could not get to the court in order to evict someone.

No. You couldn't get before the judge for anything.

Right.

And, and so that, that created lots of problems for lots of different reasons for lots of different people. A big one that we're talking about is evictions and foreclosures. The banks couldn't file.

Correct.

Landlords couldn't file. And so, it just created this logjam.

Right.

Well, and the government came out and said, like, look, even if you could get to court, we are putting a moratorium on the courts even ruling on these things. So, like, you can't— even if you could get to the court, you couldn't do it anyway. So, like, you know, stop worrying.

Yeah, and, and, you know, there's a huge problem with all of this. I mean, because the courts— I mean, there, there were even divorces that couldn't go through, right?

Right, yeah.

Like, there were, there were, um, you know, DUIs and, you know, petty theft and all kinds of things, uh, let alone the bigger stuff. But we're, you know, we're just here talking about basic rights that homeowners who are renting homes should have, which is to evict people if they're not paying.

Yeah.

Um, it's actually a protection for those people. Look, I mean, you know, so there's lots of different ways to, to get someone out of the house, right? If you're not paying your rent, there's lots of ways to get people out of the house. In fact, one of the ways, um, that I know a lot of renters— uh, sorry, a lot of homeowners who are renting, so landlords, a lot of landlords do is they do cash for keys, right?

Right.

So if you don't know what cash for keys is, it's pretty simple. It's like, look, I'll give you $1,000 to give me the keys and leave. And if you do that, I won't evict you, which means you don't have an eviction on your record, and I'm not going to have to pay $5,000 to get you out of the house.

Right.

So it's kind of a win-win for a lot of people. But at the end of the day, I mean, if someone says, no, I'm not leaving, you're gonna have to evict me. Landlords have that ability to evict people, but you have to go through the court. You have to go through these processes. And if the courts aren't open or there's a moratorium out, you're up a creek. So here's the problem. Now we've got a logjam. We got a logjam of evictions that were already underway before the moratorium began.

Mm-hmm.

Right, but they hadn't been pushed through. Now they're actually telling people like, look, if you are worried about being evicted and you're only a month behind, You're probably good for a while at least, because they're going to go after people that are 3, 4, 6, 10 months behind. They're going after those people first, most likely, because that's what they have, you know, they stand to gain the most from that. So they're almost telling people, look, depending on where you are, on how, how far back you owe, You may be okay for a little while, but I don't know how comforting that is, really.

Well, you know, there's, there's, there's two sides to, to every coin, right? So, I mean, we, we can be concerned about the people who, you know, are worried about getting kicked out and/or, you know, either evicted or foreclosed on. And like, let's just focus on the evicted people for a minute. Because, you know, I, I can, you know, just story after story after story that I've read about landlords who have now had tenants living in their property for going on like 9+ months that have never paid rent in those 9 months.

Right.

Because they knew that they didn't have to pay rent because the government put out a proclamation that said, moratorium on evictions. No matter what you do, you can't be evicted, right?

Right.

And so, like, even— I think it was— I think it was Saturday, the White House press secretary said, like, look, we've tried everything we can to try and extend this. And I'm like, why are you extending this?

Right.

Because, you know, most people think about, okay, well, these evil landlords are trying to kick people out of their home. You know, and in some instances that is true. There's like, you know, a, you know, a greedy slumlord that runs a really crappy property and he's just trying to kick people out so he can bring new people. That, that does happen. But by and large, most landlords are single property owners, meaning that, you know, they own one piece of investment real estate.

Yep.

And there was no—

and many of them, many of them that own more than one own less than 5.

Yeah.

And so, so they're, they're really needing that money. They're needing to be able to find a way to pay the mortgage on that house.

Exactly. You know, and, and, and here's, here's the difference, right, is there was a moratorium on evictions. The way that the foreclosure stuff works is it was a forbearance.

Uh, yeah.

And so the banks— the government went to the banks and said, like, look, we're putting a forbearance, or you can apply for a forbearance on this property. But at the end of the day, you still owe us all the money.

Right.

Whereas the people renting the property can go, go pound sand. Government says I don't have to owe you anything.

Yeah, and not only, not only are you— if you get, if you get access to a forbearance, and let's say you're, I don't know, let's say you're 4 months, 5 months, 6 months, um, that you don't have to pay, right?

Mm-hmm.

Not only are you still going to have to owe that money on the back end, you're still gonna have to pay, uh, the interest on all of that.

Right.

So, so whatever. I mean, and for most people, especially at the beginning of your mortgage, goodness, like 90% of your, your monthly mortgage is interest. Yeah. So, so if you got a $1,000, $1,000 mortgage, you're talking like $900 of that is going to interest and only $100 of that is going to principal. So if you're 6 months out, I mean, you're still going to have to pay interest on that on the back end as well as that $6,000 that you owe. I mean, while it seems like a good deal on some level, it's really the bank— the bank's still going to get their money, you know?

Yeah.

And so, so even if you own a home that's an investment property, you get a forbearance on it and someone doesn't pay And you need to evict them, you still are on the hook for that money. And so, you know, I feel for these landlords who have had to go for so long without having any recourse at all to get people out of their home.

Yeah, it would almost seem like the more logical thing, like if you're going to do a moratorium on evictions, that the programs that you're gonna— like the one here in Houston where, like, uh, ABC 13 says that there's $45 million just sitting in the wings waiting to assist these renters. It actually seems like it would make more sense to, if you're going to do a moratorium on evictions, to offer the— that money to the landlords. Um, which, you know, I, I get it. Like, like everyone thinks of landlords as being like these You know, wealthy oil tycoons just twisting their mustaches in the corner while they're smoking a big fat stogie. But, you know, it—

like, if we have these programs in place and people aren't taking advantage of them, why not at least set the secondary recipient up as the landlords to go, look, I have a tenant, I don't want to evict them, they haven't paid rent in 4 months. Can you at least give me half of their rent for what they owed the last 4 months?

Hmm. You know, like, yeah, that makes sense.

I mean, like, at least do something proactive in order to move that money into the hand. Because, like, if you're telling me, like, okay, it's, it's there for the renters in order to assist them to avoid evictions, but we have a moratorium on evictions. Even if they got the money, that money is appropriated to go to the landlord anyway.

That's where it's going.

So why do we have to put it through so many hands in order to get it to the person that it belongs to in the first place?

Yeah. And I guess that's one of my big questions here is what motivation other than someone pointing a finger and saying you're going to be evicted? What motivation does a renter have to go after that money to begin with?

None.

None. None. And because, because they cannot be evicted. At least until sometime in the future. And so, you know, now there are plenty of people out there who are really, really, you know, hardworking, good people trying to pay their rent who this is affecting in big ways. I get it. But I'm going to play devil's advocate here for a minute, um, and I'm going to ask a question that, um, I think a lot of people might scoff at, but I just want to put it out there because I think some people are thinking of it. And I want to just ask it, like, why has it taken so long to lift the moratorium? I mean, and here's, and here's why I asked that question.

You and I know that at least where we live, and I know this is true around the country, there are people begging people to come work for them. Begging. I mean, you want to know why our gas prices are high? Because we can't get anybody to run the truck to get from the refinery to the gas station, right? You want to know why your food's so expensive? Because we can't find someone to run a truck from the warehouse to the grocery store. Let alone all of these other little places like the restaurants and other places that are just begging to have employees, and they can't find anybody willing to work. Okay, so if we have a national shortage of, of people that are willing to get

paid to do work, then why is it taking so long for the moratorium to be lifted?

Well, I mean, well, I think that yes, I agree with your, your questions there, and, and I think they're fair questions to ask. I think there's probably a lot of people that listen to this that might be screaming at us going, that's not the only reason.

I get it.

And that's fair.

No, I, I get it.

Yeah.

And I, I'm only asking the question to play devil's advocate. I'm not even saying I completely agree with what the actual answer is or even asking the question. I'm just saying that I think that's a question that people are out there asking is, look, you can go get a job because people are willing to give you a job. And if you have a job, then you can pay your rent.

Yes.

You know what I'm saying?

That's hypothetically— Yeah, sure.

It's the logical sequence of events. And so I— my point is, this problem is big. Yeah, it's not— it's not a simple answer. It's not as simple as saying, look, You know, they should have lifted it earlier, or, you know what, they should have extended it. Whatever it is, there's not an easy answer to this. But what I do know is there are a lot of landlords just pulling out paperwork left and right, filling it out, trying to figure out how to evict these people. They'll, they'll take it on the chin as much as they can.

Yeah. And, you know, and like, hear, hear me, hear me say this with as, as much compassion and understanding as possible. But, right, like, we doled out— and I— the collective we, the United States, doled out a lot of money to people over the last year and a half.

Yeah.

Either through child tax credits or just emergency relief, um, all sorts of different ways in which the US government sent money into the hands Of people. Now, to be fair, all those people had to have filed their taxes within the last two years.

Ba ba ba ba ba.

I get it. There was no accountability for how that money was being spent.

Nope.

You know, and and so it it seems to me, and I again, like you and I probably don't know how the moratorium. Uh, or man, what's the other word that I used? Forbearance. We don't know how the moratorium or the forbearance actually worked because you and I paid our bills through this, luckily. Like, we, we kept our jobs.

We were blessed.

We were blessed. Like, we, you know, we got to take care of our families. We didn't go through a lot of the hardships that people genuinely went through. But if, you know, I would imagine there's some sort of like document or declaration that you have to make in order to even be in forbearance or moratorium. Maybe not. I don't know. But it seems like if you're going to take money from the government and you're going to claim forbearance or debt coming, I can't keep my words straight, Kevin.

The moratorium.

Moratorium. If you're gonna claim moratorium or forbearance, you ought to at least show that the money that you're receiving, a portion of that should go towards rent or mortgage.

Yeah, but—

If nothing else, because we don't want our financial institutions to fall apart, which is, you know, part, part B of this conversation that I think we're about to have.

Sure. So, but one of the things you— if you were to go back and listen again, uh, to what the government was saying is, Go spend the money.

Yeah.

Back, back into our economy is what they were saying. Go buy a new TV, go buy, you know, go put a down payment on a car, go do whatever you have to do to put this money back into the economy to stimulate the economy. That's why they called it a stimulus check. Never once did I hear someone in position of power say this would be a really good way to keep yourself out of eviction.

Yeah, well, because there weren't any evictions.

There weren't. But, you know, I never heard someone say, you might— this might help pay your electric bill. You know, it was, it was all about, you know, stimulating the economy. Now, what I am hearing now with some of these child tax credits that are coming from last month through the end of the year is this is to help with your children. You got more people to feed, those sorts of things. I'm hearing that more now. Sure. When it comes to the, to those stimulus checks that were big chunks of money being handed out. It was more like, let's stimulate the economy, than it was pay your bills.

Yeah. So, so let's, let's pivot a little bit then. Because I mean, let's face it, we have been riding the real estate gravy train for how many months now?

Oh, golly. It's been, it's been a crazy, crazy year for sure. But probably 7, 8 months, 9.

I think that's fair.

Yeah.

You know, and, and so prices have just continued to go up and up and up and up. And I'm, I'm curious as to what you think now is what's going to happen now that it's open season on evictions and foreclosures. Now, foreclosures are going to be a little bit different because People could go into forbearance, and I think those have a cap on the time limit that the government set. And I, I think if you have reached the extension of your forbearance as of Saturday, you can go into foreclosure, or the bank can put you into foreclosure. But I think there's a certain amount of time. I need to double-check this, but I—

It's like 6 months, right?

I think so. But I think after you've used that up, then they can begin the foreclosure process. But either way, at the end, when you decide to come out of forbearance, you have to set up a way in which to pay back the money that you didn't pay during that forbearance time.

Yeah, and there's, there's a few different ways to do that. One of those ways is just to set up like a payment plan. But you have to go in and set that up with the bank basically, and, or, you know, say, look, I'm going to pay you back this amount, you set it up with this number of months. Exactly. It's kind of this whole separate thing to basically say, I'm going to pay the money that I owe you. That's actually one of the things that there's a— that Washington Post article actually had an FAQ section to it. One of the FAQ answers was a question that said, what do I do if I'm if I'm evicted?

And it basically said, well, the first thing you need to do is don't ignore it.

Yeah.

Go, you know, do what you need to do. Go to court and plead your case. You know, like, don't, don't just ignore this and just hope that it magically goes away. It's not going to go away.

Yeah.

Right. So, um, you know, I, I, I think there's a couple of things that will happen. I think that there's going to be, um, I think, I think you're gonna have some people that have been landlords of that 1 or 2 properties that are just sunk, man, and they're gonna get out from under their house as fast as they possibly can. So I think one of the things that's gonna happen is we are going to see a little bit of, of an influx of properties. Now, one of the reasons that, from what I understand, and I'm not a real estate expert by any means, But what I do understand is that part of the reason that prices are so high and why

people are, you know, getting 15, 20, sometimes even 30 cash offers on their home and they're all over price, asking price, is because there's just not enough homes on the market. What we're talking about is we've got an inventory—

Got an inventory issue. Yeah.

Issue. Yeah, we just don't have enough inventory out there. So if you're looking for a 4/3 or 4/2.5 or whatever you're looking for, I mean, you may be looking in a certain area and there may be 2 of them, right? And, and most of the time there might be 50 of them. And so it's just that you're looking at an inventory problem. So one of the things that I think could happen is you're going to have some of these landlords who are like, man, I just, I got to get out from under these houses. I can't afford the mortgage. I'm behind on it because I couldn't afford it. I'm in forbearance. I'm about to be in foreclosure. I gotta just get out from under it.

I think we could see a little bit of a relief on, on the, the inventory reduction that we've been seeing.

Yeah.

Uh, the other thing that I think could happen is we could see renters having to go, look, my mortgage is $1,000. I was charging $1,200. I'm gonna have to start charging $1,500.

Yeah.

You know, I've got to figure out a way to recoup this. And so all of a sudden, we're gonna— I think what we're gonna wind up seeing is we're gonna see people go, look, I, I could buy this house for $1,000, but I'm gonna pay $1,500 in rent. Now I'm gonna go start seeing if I can figure out a way to buy the house rather than rent the house. And so we— one of two things I think could happen. Either we're gonna see some of that inventory reduction go, go down a little bit to where there's more houses, or we're gonna see some of these renters go, look, it's time for me to start buying a house.

And then if that's the case, and we've got more people looking for a home, and the inventory is going to get worse.

Well, here's the thing though, man, is like these people who haven't been paying their rent, like, I can't imagine that their credit's in good shape to start moving towards homeownership.

You're probably not wrong. I mean, and I don't know what they're gonna do to—

I mean, like, well, that was COVID. Like, I can't imagine any institution going like, well, okay, it was COVID.

I guess part of it depends on, you know, yeah, but sometimes you don't need credit to buy a house. You know, I mean, if you've been stockpiling money away, because you haven't been paying rent. That's true.

Well, but like, you know, You know, yes, but like, you have to account for the amount that house prices have gone up, right?

Yeah.

So even if you've been stockpiling money, there's no way that you have enough cash on hand just in the last year and a half to go pay cash for the house that you would be living in now.

Most of the time, that's probably true. I'm sure there are rare occasions where some people are renting just because they don't want the hassle of owning a home.

For sure. Yeah.

Right. I mean, there, there are cases where that's probably true. But even still, you know, those are probably the people that are actually happy to pay their rent, not the ones that are, you know, not able to pay their rent. We're probably talking about 2 different types of people. And as I say that, that sounds very harsh. I don't mean it to be.

Well, just, just real quick, we had a, we had a comment come through on the Facebook channel that said that, like, in Houston, at least, the number you called, 211, to get renters assistance.

Yeah, and that's not just a Houston number. That is a— actually, that was on the Washington Post FAQ page, was what can I do? And one of the things it says was call 211. So what I'm guessing, 211 has probably got some sort of a proximity to it, kind of like 911 would. Probably. And so this kind of goes back to what I was, what I was going to say earlier. Whenever you're talking about, you know, how this all works, from state to state it's going to be different.

Mm-hmm.

But 211 in most states, it's not every state, but most states including Texas, that's going to get you to a specialist who's going to be able to help put you in contact with a community or an agency, community organization or an agency They can help you with your housing needs.

Yeah. So thank you, Brett, for that.

Yeah. Making sure we brought that up.

Man, well, I— here's, here's the quandary that I'm wondering about, because if you have, if you have all these homes that people haven't been paying rent on, right? So those guys have been in You know, this moratorium process where they're not paying rent, the landlord can't evict them. I can imagine that in general, the good-hearted tenants have not been taking good care of the property.

Yeah, I would agree with that.

Because no matter what they do, up until this past Saturday, they couldn't be evicted.

Didn't matter.

Didn't matter. So even if you evict this person, and what you're talking about is, you know, okay, well, now these, these houses are going to be entering the market because we can evict them. And let's, let's also remember that eviction is not immediate. I mean, it takes some time to evict people. So like, we're gonna, we're gonna, we're gonna have some time pass before this, these houses enter the market as part of the supply. Right. And once they receive that eviction notice, I can imagine that they're going to continue to not take care of the property. That's almost always the case when you evict somebody is that, you know, a lot of times they'll just trash the property.

Right.

More out of spite than anything. But—

Sure.

I can't imagine that over the last 6, 9, 12 months, you know, that these, these people have not been taking very good care of the property. So the quality of the supply that's going to be hitting the market is going to be much lower. Yeah.

So, you know, I wonder if that's just going to, you know—

I don't know if that's going to tank the prices of other homes because the quality is so low, but now it's entering the supply, or what that's actually going to— or if it's actually going to raise the prices of the other ones of, you know, like, hey, you can buy one right now at a reasonable price, but it's like you know, heap of, you know, smoldering crap. Or you can buy this brand new one for 80% more than what you'd pay for this smoldering heap of dung.

Right? Yeah. But there are plenty of people out there who would love to flip those houses. I mean, oh, for sure. Again, again, what we're talking about here is we're talking about skyrocketing house prices. That, um, these investors who love to go in and flip homes, they, they have been either out of the game or playing a game that they never wanted to play because prices are just too high. So if they can get their hands on some of these, you know, heaping smelly piles of dung, as you, uh, so adequately—

Smoldering. Smoldering.

Smoldering.

Sorry.

Um, again, I'll try to get it right.

Get my adjectives right.

That's right. I think that some of these people are going to be really happy to come in and scoop them up. And whenever they do, you're going to pay a premium for that house that was just tore to shreds because they're going to come in and they're going to put in, you know, the lowest quality granite they can, the cheapest, you know, slab of paint that they can slap on the walls. They're going to put on the cheapest carpet they can put in. They're going to make it look really nice and then they're going to charge a premium for it. And, and, you know, you've got the nicest house on the block all of a sudden. And I'm, I'm thinking that, again, this could go either

way.

I— well, yeah, I, I agree with that sentiment too. I don't know what the market's gonna do with it, though. So, so to cap off this, you know, this, this lovely conversation. Let's, let's make some predictions.

Okay.

What, Kevin, what, what do you think all of these things— because there's a lot that happened on Saturday.

Yeah.

And a lot that's going to be happening over the weeks to come. What do you predict is going to be the effect on the housing market? And if you, if you don't feel comfortable making like a nationwide prediction, you know, just, you know, keep it local, keep it maybe to Texas or to the Houston area. What do you think? Because, and Texas may be unfair. I feel like places like Texas, Tennessee, and Florida have largely been insulated from a lot of the stuff.

Yeah.

That's, that's been happening across the country. But so let's, let's keep it broad. Let's say US, US predictions. What do you think's gonna actually happen to the, to the housing market?

Yeah, so, so first of all, I want to say that I think that we're going to have a problem with people who are being evicted left and right, who are going to have evictions on their credit now. And they're not going to be able to find a place to live. I think we're gonna have a big, big problem with that. I think we're gonna have families with children that are going, I can't get an apartment. I can't get a house. I can't get anything. I'm homeless. I'm afraid we're going to have that problem. But unfortunately, I think what's going to happen is I think the housing market prices are going to go up. I just think they are.

Because I think that these, these people that have, that have been renting these houses, these landlords, they're gonna have to find a way to recoup that money.

Mm-hmm.

And these, these rent rent prices are gonna go up. And I think as soon as the rent prices go up, I think people are gonna go, look, my house is actually worth more because this house next to me is being rented for 50% more than I pay, you know, my— for my mortgage.

Right.

Um, and I think that they're gonna go, look, my house is worth this. And they're gonna stick to their guns whenever it's time to sell. They're gonna go, no, I don't care what you say it's worth, Mr., Mr., Mrs., uh, uh, real estate agent. I'm gonna charge this much for it, and either someone will pay it or they won't. And so I, I think that over— overall, I don't think we're gonna see a reduction in, uh, the number of houses that are on the market. I think— I mean, we're not going to see an influx. I think we're going to wind up continuing to see the reduction take place for the next 3 to 5

years, and I think prices are just going to continue to rise.

I don't know if you saw the comment that just came through. Melanie— I thought Melanie had a good point— is like, who Who goes first, the renter or the landlord? Are they going to foreclose on the landlord? Are they going to evict the tenant? To her point, who can afford to move last?

No, I think that here's the problem.

I think ultimately, the landlords are going to take it in the shorts. I think ultimately.

Yeah, I think so too, because the banks are going to be able to move faster than the landlords are.

Yes. Well, and I think, I think there's going to be less compassion for them as well.

Yeah.

And like, not, not even talking about like the spirit of the law. I mean, like, I think in general, judges are going to want to move faster on foreclosures than they will on evictions.

Yeah. And if I— I'll tell you right now, if I were a landlord right now, I would be offering cash for keys as quickly as possible.

Yeah. Yeah.

That's just what I would do. So what say you?

Man, I think we're going to see some interesting stuff in days to come. I'm reminded of a statement that Obama made, and man, I can't remember what— I think it was like 2012, I think it was, when he said that too big to fail. He said these, these institutions are too big to fail, you know, and I think as we see some cascading, uh, real estate stuff begin to happen similar to what we saw in 2008 with the, with the housing market crash and the, you know, the, the massive amounts of books of bad loans that these banks were making, which I don't think is the case this time. I think the government stepped in and made a lot of these loans bad. Um, I think as a lot of these

loans begin to be foreclosed on, we're going to see a response in the market similar to what happened in 2008, but I don't think that it's going to be nationwide like it was last time.

Okay.

I think a lot of this is going to be localized to states where we've seen a lot of flux out.

Um, and so you're talking like, you know, like the Californians, the New Yorks, the—

You start talking about like California, Washington, New York, um, Maryland, uh, you know, different places where they've had heavy restrictions on COVID regulations on top of, you know, just other things that have been going on in those states. And, and so like, so like here in Texas, like we've had a huge influx of people from California.

Yep.

I know other states have experienced influx of people from California, New York, Connecticut, Maryland. I mean, a lot of northeastern states. People are moving out of places like Oregon because they don't wanna be near Portland anymore. I'm trying to think. There's, well, Baltimore, that's in Maryland. People are trying to move away from some of the bigger cities. And a lot of it has to do with that they can have a bigger home in a warmer climate and they can keep their job because now their job's remote, so they can live anywhere. And they can go to places where their taxes are lower, just all sorts of other things that they enjoy about those places. So I think if you're patient,

you stand to make quite a bit of money in a shallow real estate market in places like California, Maryland, New York, Portland. Portland's not a state, but a city. But then, you know, Oregon, uh, maybe—

Might as well be.

And then, you know, yeah, Portland's basically the state of Oregon. Um, even parts of Washington, man. Um, I think in some of those places where you're gonna see, uh, a lot more supply, because in Texas, Tennessee, and Florida There's just no supply and there's going to continue to be no supply. And so the demand is going to continue to be high. And with low supply, high demand, the prices are going to be what the prices are going to be. Those places—

They're going to be high.

Those places, I think we're going to see a surplus of properties that people can't unload now. Now that evictions and foreclosures are available, you know, I don't see those markets doing well. And so I think it's going to be one of the first times in a long time in U.S. history where we see a divergence in the real estate market from state to state.

Okay, so here's a really, really interesting question that just popped into my brain. Do you think that we're going to start seeing new, new language around, uh, these contracts that landlords are putting into place I don't—

well, here's the thing. I don't know— I don't know why they would do that because they— they had that in place for the existing contracts. The government just came in and said those contracts were no good.

Yeah.

So, I mean, like— and— and so they're like, well, why would I even waste my time updating my contract? I just got boned by the federal government. Yeah.

I don't know. I mean, I— I know there's a lot of really smart people out there, and there may be— there may be lawyers all over this trying to figure out a way There may be.

I mean, I can— and they're definitely all smarter than I am, but like, yeah, I'm just— I mean, like, if, if, if the US government can come in and say like, look, you both consented to sign this, you know, mutually agreed-upon contract, but we say no. Yeah, then what did I go through all this trouble in the first place for? Like, I don't get it.

Screw you, government.

You know, so like, you could be as smart as you want to, but if they come in and say, eh, we don't like that now, Yeah, yeah, I don't know. So why even—

yeah, so I don't know. I just think there might be, there might be some, some crafty people out there figuring out a way to— I don't know, maybe, maybe it's, maybe it's you're no longer a renter, maybe you're a contract liver in my house person, you know?

Like, I don't know, you know? I mean, like, that, that could— I mean, like, Airbnb could definitely take off more as a long-term living situation. Where you can, you know, rent week to week.

Yeah, because, because at that point, you know, you could go in and change the locks, you know. Yeah, anytime you want, you know. I don't know, I just, I think there's gonna be some people that are gonna figure out a way around this.

If you are a landlord, Airbnb might be a more tenable position for you financially, because like you said, when that contract is done, which was, I rented this house for 4 days, Cool. The locks are changed. Good luck getting back in. And it's not an eviction at that point. It was a short-term rental. Yep.

So that's exactly right.

That may be the way a lot of people go. I mean, like, we're, we're fixing to do that with a, with a property that we own. And yeah, like, I have zero interest in having long-term renters in that place.

No, no, not at all. If for no other reason, you want it on the weekend.

So But like, you could even do it to where it's like, look, what is it every month? Well, it's $120. I mean, it's $1,200. Okay, what is it every week? It's $300. Yep. Right. Yeah.

Oh, exactly. No, that's exactly right. I will put out there, I'm going— we got another comment over here from our friend Brett. I don't know if he's saying it this way or if I'm just reading it this way, but back whenever we were talking about what we thought the housing market was going to do, he posted, when you buy the foreclosed house, does it come with the tenant?

Yeah. Well, no, like, that used to be a selling point for homes, right? Yes, it did.

It did.

And you had to disclose that to the buyer, that like, look, you know, you can't go look at this property because there's a tenant. It's tenant occupied. And that actually used to be a benefit because you could go, okay, well, how long has that tenant been there? And, and so the rent's been this for how long? Okay. So, yeah. And, and so you could go, okay, this is already a cash flowing property, like, and the tenant's already there. I don't have to go find one. So yeah, I'll buy this property. And now if you, if you got that listing and you're like, tenant occupied? Oh, hell no.

Right. Yeah. No, no, that's not gonna fly anymore. I mean, you know, it's just, uh, like, no, I don't, I don't, there's a reason you got out from under that to begin with, you know?

Yeah, absolutely. So what else we got, Kev? I mean, we're, we're creeping up on an hour here. I mean, like, I, I can talk about this stuff for a while, but I think we kind of covered it.

Yeah, no, no, I, I agree. I think we're, um, we're just going to be circling ourselves for a while if we keep talking about it. And there's probably another show in here somewhere. I would really like to hear from some of our listeners, and maybe you have some answers to some of the questions that we've brought up. And I'm sure there are some people that are angry over some of the things that we've brought up and, you know, asked. But, you know, at the end of the day, it's, it's a big deal. We're living in unprecedented times in so many ways. And now a moratorium has ended.

Mm-hmm.

It's gone. You can't bring it back. You're— I mean, the government can, but they probably aren't gonna. And so we're living with with what we got. So, you know, I'll tell you this, like, if you, if you're listening out there and you're a renter, which I know we don't have very many of those people, uh, in our audience, but if you're a renter out there and you've, and you've been, um, in a situation where you haven't been able to pay your rent, call 211. Just do it.

Yeah.

Call them tomorrow. I mean, if there, if there's, if especially if you live in the Houston area, if there's $45 million sitting out there, the chances of you getting some of that money seem to be pretty good. So do what you can. You know, we're definitely, you know, we're not anti, uh, people paying, you know, the rent. We, we want you to pay your rent. We want you to be able to.

So, um, you'll feel better.

Well, and every— everybody will. I mean, goodness, they're— here's the other part of this. I mean, so many people just are non-confrontational people, and it's one of the reasons they had to put in the FAQ, don't ignore an eviction. You know what I mean? Like, don't, don't be non-confrontational. Like, be confrontational a little bit. Yeah, you know, but don't do it in a way that's passive-aggressive by not paying your rent. If you can pay it, pay it. And that, and, and that's it. That's another thing that I'm kind of like, I know there are people out there that aren't paying their rent because they didn't have to. If you can, do it.

Yeah, you know.

So yeah, well, man, that's about all I got. You got anything else?

No, man, that's all I got.

Cool. Well, uh, thank you guys for, uh, downloading today's episode. It has been fun. If you haven't already, uh, subscribe to the channel. That would be great for us. Uh, send us a Facebook like and all of the things. Um, more importantly, if you get a chance, we would love for you to go and leave us a rating and review on iTunes. That would be fantastic. But we are so glad that you're here with us.

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See ya.