Realtor Kyle Whissel shares his thoughts on how your home value is going to be affected by the eviction ban ending along with the foreclosure moratoriam.

How is the eviction ban ending and the foreclosure moratorium ending going to affect your home value?

Hey there, it's Kyle with the Whissel Realty Group. I want to share a little bit about how your home value is going to be affected by the eviction ban ending and the foreclosure moratorium ending. Big changes are coming, or are they? I don't know, we'll see. So let's talk a little bit about the eviction ban first.

Eviction Ban

So for the last 18 months or so, it's pretty much been impossible to evict somebody here in the state of California. Short of them running a meth lab in your garage and blowing it up, pretty much been impossible to evict somebody even at that tenant was not paying. Which means if you owned a property and you had a non-paying tenant in there, you're probably not loving being a landlord right about now. You potentially have gone 18 months without receiving any money from your tenants. Kind of sucks. So I believe that you're going to see some people who've been landlords decide this landlord thing is just not for me and I'm going to sell my property. Now some of them are just going to sell and get out of the whole landlord game. Some are going to sell and move to states where it's a little bit more landlord friendly because California is definitely not the most landlord friendly state. So what does that mean? You are going to see a few more of those rentals come on the market for sale. Let's talk about the foreclosure moratorium ending.

Foreclosure Moratorium

If you have been affected by COVID, the government realizes this and said hey we're, if you can't make your mortgage payment, we're not going to foreclose on you. We're not going to allow the bank to foreclose on you. We can't because we understand it's tough times. Now most banks have been working with homeowners through things like forbearance or loan modifications, or a variety of different things to help people stay in their home. There is becoming a point now to where those things are going to kind of fade away and you got to start making your payment again. Well if you're in a situation where you can't make that payment anymore you got a couple of choices.

You could get foreclosed on which shouldn't happen because the benefit of COVID is that values have shot up substantially, 30 plus percent here in San Diego since COVID started. So the value of the home is going to be substantially more than it was when COVID started. So what we're seeing a lot of owners that are reaching out to us are saying hey, I'm, I'm about to get foreclosed on. I can't afford my mortgage. Instead of giving them bad news, we actually get to give them the great news. Congratulations, your home is actually worth 30% more than it was before COVID started. So instead of them getting foreclosed on, they're realizing like oh my gosh, I'm actually going to get a really nice payday, which is really cool. So that's a fun thing.

So if you're in that situation we should talk. What is that going to do? That's going to put a couple more homes on the market. So I believe that both the eviction ban and the foreclosure more times ending, you're going to see a little bit of increase in some of the supply of homes for sale. Now, real estate is a function of supply and demand, but when supply goes up, that does have an effect on home values. So I believe that this little bit of an increase in supply will help keep home values increasing at a little bit slower rate than we've seen. I don't think we're going to continue, continue to see two plus percent a month like we've been seeing.

In Closing

My personal belief over the next 12 months we're going to see something around a half to 1% average per month. So with that being said probably six to 10% appreciation over the next 12 months. So I think that little bump in supply is probably a good thing. It's not really healthy for the real estate market to go up 2% a month. When things blow up very quickly, that's when they pop and you end up in that whole bubble situation. So I'm personally all for things to just kind of slow us down. Half percent, 1% a month, very healthy for the market. That's something that's really sustainable. If you want to figure out what you could sell your home for, or you've got a home, you finally got that nightmare tenant out and you want to cash in on that equity give us a call. Call us down at the phone number below. We'd love to help you explore that opportunity. Or if you're just curious, what is your new home value coming out of COVID give us a call at the number down below. I'm Kyle Whissel with Whissel Realty Group.