When the unemployment rate is high, consumer spending is less. As of March there has been an addition of 162,000 new payroll jobs. Compared to the past three years every month thousands of jobs were lost. Definitely purchasing a home is not on the individuals priority list, their main goal is making it through the year with any savings they might have.
Freddie Mac released a report showing:
- 58% of their borrowers were delinquent last year due to unemployment or reduction of income.
- 16% of the homeowners in default stated that payments were extreme
- 11% were delinquent due to illness or death in the family.
- 5% reported marital issues as a reason
- 3% were unable to sell the property
- 2% had a job transfer
- 1% had property defects
In January those who were 90 days or more delinquent on their mortgage accounted for 4.03% and a month later that percentage increase to 4.08%. This increase is considered the lowest increase in about a year. The amount of loans that are delinquent continues to grow. According to the LPS more data should be collected on the flow of the amount of delinquencies between each 30 day period, this is known as roll rates. As of right now these rate are not showing any type of stabilization.
The real estate market should be thankful for the tax credit and low mortgage rates have somewhat stabilized the housing market. Government programs to help distresses homeowners keep their homes are another positive factor in the market. Hopefully, this will prevent the amount of foreclosures taking over the market.
Contributor, designer & admin for JohnHart Gazette.
I couldn’t understand certain parts of this article, but I guess I just need to learn a bit more about this, because it sure sounds interesting and kind of though-proviking! By the way, how did you first get started with this?