While the pandemic introduced moratoriums on evictions, these holds generally expire at the end of the year, at which point American renters will owe billions of dollars on back rent that they will be hard pressed to pay off, reported the Wall Street Journal. By the end of this year, American renters will owe at least $7.2 billion in past due rent, a sum that could grow as high as $70 billion if the government does not approve a new stimulus deal before then. In such a case, it is estimated that 12.8 million Americans will owe an average of $5,400 worth of missed payments.

This, in turn, is a problem for landlords, who face expenses of their own that they will be hard pressed to pay. In New York City alone, about 15 percent of landlords may not have the money to pay their property taxes or their water and sewer bills come the next deadline in January. Over the past eight months, residential rent collections were 84 percent of the expected amount; in addition, landlords have been challenged by a dearth of new tenants as residents left the city.

The Journal noted that such debt loads can be an impediment to the economy recovery. If nothing else, paying off their past due bills means renters cannot spend on other items such as consumer goods. This debt can linger for years, meaning that millions of people will spend the next few years financially kneecapped, making it more difficult to meaningfully participate in the economy or even just plain survive.

Practitioners interested in how this situation might affect the real estate market from a construction standpoint may want to attend the Foundation for Accounting Education's Construction Contractors Conference on Dec. 1, which features two separate tracks: one for the construction industry and one for the real estate industry.