The coronavirus has managed to send the U.S. housing market surging in opposite directions simultaneously.
On one end, demand for new mortgages and homes is surging as buyers look to take advantage of rock-bottom interest rates and eager sellers.
On the other end, homeowners across the country are struggling amid the upended economy, and can’t make their loan payments.
Late-stage mortgage delinquencies rose to 1.4 percent among borrowers in July, the highest level since 1999, according to a new report from CoreLogic. The July numbers represent the latest available data and stand in contrast to pre-Covid March, when late-stage delinquencies — 120 days or more — stood at just 0.1 percent.
“Many homeowners are beginning to feel the compounding pressures of unstable income and debt on personal savings buffers, creating heightened risk of falling behind on their mortgages,” said Frank Martell, president and CEO of CoreLogic in a statement.
Miami, which was one of the epicenters of the housing crisis in 2008, reported one of the highest rates of mortgage delinquencies in July. In Miami, payments that were more than 30 days late rose to 12.1 percent, up from 5 percent in July 2019. Mortgages that were more than 90 days delinquent in Miami totaled 8.4 percent in July, up from 2 percent year over year.
New York City also recorded one of the highest delinquency rates in July. Mortgages with delinquencies over 30 days totaled 10.5 percent, compared to 5 percent in July 2019. Mortgages that were more than 90 days late rose to 7.5 percent in New York, up from 2.5 percent a year ago.
And in Los Angeles, mortgage delinquencies over 30 days totaled 6.3 percent, up from 2.3 percent year over year; delinquencies of more than 90 days totaled 4.1 percent, up from 0.6 percent in July 2019.
Nationwide, all states saw increases in delinquency rates of 30 days or more and 90 days or more because of the pandemic, the data shows. States that reported the highest rates included Florida and New York, along with New Jersey and Nevada.
Many state governments and federal agencies have enacted moratoriums on evictions and foreclosures, preventing foreclosures from happening even as delinquencies increase. A foreclosure moratorium on home mortgages backed by Fannie Mae and Freddie Mac extends through December.