The Biden administration has extended the COVID-19 moratorium
on foreclosures to July 31, 2021. Totally avoiding the policy and ideological
discussions that could be had about such a decision, one thing is apparent—the additional
month extension will increase the backlog of foreclosure and eviction cases
that courts around the country will face once this moratorium has ended. Absent
any legislative changes, the implementation of creative government programs
mitigating distressed loans or both, foreclosure filings, executed foreclosure judgments
and foreclosure-related evictions are all set to see an uptick over the next
year.
An increase in residential foreclosures and evictions is certainly bad news for affected homeowners and tenants, who will have to find new living arrangements, undergo costly moves in short timeframes, uproot their lifestyles and, in some instances, face long term financial effects. Increasing foreclosures will also serve as a market correction in the real estate market, which is currently driven by inventory scarcity. Amidst the market change and its social implications, many real estate investors can be left wondering which strategy to employ. The answer is simple—any or all of them.
