What happens when the rent moratorium ends?
President Biden is set to end the rent moratorium on July 31. You can read more on this article here. If that happens, all renters and the landlords will have to agree on a repayment plan of all the back rent that hasn’t been paid since the moratorium went into effect at the beginning of the Cerveza sickness. Some landlords may request a lump sum all at once and if not paid back by a certain date, then the eviction process begins. Others may offer a payment plan… while at the same time paying their rent once again.
In Canada, the repayment plan began July 10. You can find more info on that here.
Could this mean another government bailout for those who are threatened with eviction? Biden is proposing a 1.9 million dollar bailout for exactly that. What about all of the people who continued to pay their rent when they had the option to not pay rent? In a world where “fairness” is king, how is that fair?
The bottom line is, even if a bailout comes through, it won’t be enough. It will also continue to build on the destruction of an already fragile economic system based on fiat currencies.
Let’s walk this through even more. Housing prices have skyrocketed this past year. With renters potentially being evicted in droves, that means a massive reshuffling of renters moving to new homes… hopefully, it doesn’t mean mass homelessness! With so many jobs available and many states offering “return to work bonuses,” mass homelessness shouldn’t be the case, but we’ll see. With an enormous amount of people looking for new homes to rent, the rental prices might spike making it even more difficult for these people, putting more pressure on the government to do something.
Like clockwork, the government will step in again to make things worse and the more they continue to step in, the weaker they make the USD. When the USD is weaker, prices go up, but the value could be collapsing at the same time. Remember price and value are 2 different measurements and people who know how money works, focus on value. In this debt-ridden world, it’s the debt that is turning into an asset because debt gets wiped out with inflation. And that’s exactly what the government wants. To wipe out its debt. But be careful what you wish for because that will eventually cause a collapse in faith in the system on which all the currency around the world is based.
Should you buy a house or stay on the sidelines if prices will continue to go up even though the value may go down? That’s all an individual decision based on several factors. For instance, I rent and buy at the same time. I rent the place I live in because it’s vastly cheaper than purchasing where I live in Vancouver, BC. I buy rental properties in cheap locations where the rent covers all my costs and puts more money in my pocket each month.
The homes on either side of me in North Vancouver went for 2 million each. That would mean I would have to drop $400,000 on a downpayment and still have to pay over $6000 in mortgage payments each month, even with these record low-interest rates. Instead, I can use the 400k to put a downpayment on homes that bring in residuals to pay for my $3450 per month rent. Most people choose to purchase the home they live in that takes money out of their pocket every month and ties up all their capital in the down payment. Whereas if you live in an expensive housing market like I do and choose to purchase rental properties and rent the house you live in, you can own several homes that bring in extra money to pay for your rent!
Why don’t I just leave and go to a cheaper place to live? Well, unfortunately, the movie industry is in Vancouver, LA, and a few other expensive places to live around the world. And while I’m still moving steadily toward my financial freedom, I structure my home purchases this way so that eventually I can live anywhere I want when I choose to retire from the film.
I will walk you through strategies like this and ways to accelerate your residuals by using banker tricks Walt Disney used in my new masterclass coming out very soon! Be on the lookout for a webinar sign-up sheet where you can learn more about these strategies and implement them for whatever situation you may be in and whatever stage in life you are at.