As millions of homeowners are cash-strapped, foreclosures and Wall Street landlords loom on the horizon. Single-family landlord giants have gained millions of dollars to purchase more rental homes during the pandemic. There is a possibility that homeowners may sell their properties while the market is hot in order to secure more cash and move toward renting, according to Realtor.com. More than one in every 10 homes sold in the US is purchased by an investor, and these giants have only seen exponential growth since March.
People behind on their payments aren’t being kicked out of their houses yet because of federal and local restrictions on foreclosure enacted during the pandemic. Many with federally guaranteed mortgages have entered forbearance, which allows them to skip payments for up to a year without penalty and make them up later.
Some 3.5 million home loans—a 7.01% share—were in forbearance as of Sept. 6, according to the Mortgage Bankers Association. Many more borrowers are behind on their payments but not in forbearance programs with their lenders.
Meanwhile, bidding wars are breaking out for suburban homes hitting the market.