While home delinquency rates rose slightly from August to September, not a single state has seen an overall rise in rates year-over-year.
Nationwide, the delinquency rate in September was at 3.8 percent, according to the latest CoreLogic data released on Tuesday. The number is up slightly from 3.7 percent in the previous month but still down from 4.4 percent last year and at a 20-year low for September. The foreclosure inventory rate, which measures the number of mortgages in the foreclosure process, is at 0.4 percent — marking the 11th straight month that the rate has been the lowest since 1999.
CoreLogic
While cities such as Dubuque, Iowa, and Pine Bluff, Arkansas, saw small upticks in delinquency rates, not a single state has seen a rise in its overall delinquency rates for the first time in years. Mississippi, North Carolina, Louisiana, New Jersey and South Carolina saw some of the biggest drops in annual delinquency rates overall.
“The decline in delinquency rates in North and South Carolina compared with a year ago reflect the recovery from Hurricanes Florence and Michael, which hit in the autumn of 2018,” said Dr. Frank Nothaft, chief economist at CoreLogic, in a prepared statement. “Shortly after a natural disaster, we tend to see a spike in delinquency rates. Depending on the extent of devastation, serious delinquency rates generally return to their pre-disaster levels within a year.”
CoreLogic
And while certain pockets of the country have struggled with delinquencies and foreclosures immediately after a natural disaster, the overall picture is quite positive. Even with month-by-month fluctuations, fewer people are now struggling to pay their mortgages than at any other time in decades — a change that, according to CoreLogic, is caused in no small part due to low interest rates and a strong job market. Taken together, these factors permit more people with not-so-high salaries to make the leap from renting to homeownership.
“The strong labor market in the United States along with continued prudent underwriting practices for mortgage origination have combined to power favorable loan performance over the past few years,” said Frank Martell, president and CEO of CoreLogic, in a prepared statement. “Unemployment reached a 50-year low in September 2019, which helped push annual delinquency rates downward for the 21st consecutive month and we expect this trend to continue as we enter into the new year.”