Just over 3.4 million borrowers, representing 6.4% of all mortgages outstanding, are now in forbearance plans. That’s an increase of 477,000 loans in just one week, or a nearly 9% jump, according to Black Knight, a mortgage data and analytics firm, which is running weekly tallies. These forbearances represent $754 billion in unpaid principal and include 5.6% of all Fannie Mae and Freddie Mac loans and 8.9% of all FHA/VA loans. Source: https://www.cnbc.com/2020/04/24/mortgage-bailout-balloons-by-half-a-million-more-loans-in-one-week.html
How do you think this will play out?
52% of American renters say they are confident they will be able to pay full rent in May, compared to 69% who said they could in April, according to a new survey, but those numbers could change as more federal stimulus checks hit bank accounts.
63% of renters said they have suffered income losses related to Covid-19.
A significant percentage of renters plan to move within six months.
It seems as if everyone believes that all these jobs are still there waiting for everyone to return.
The big question is what % of these jobs have vanished forever or been replaced by efficiencies or permanent changes in behavior?
Another point is that these numbers do not represent ALL of the unemployed. Evidently many cannot get in to actually apply or even worse are not eligible for some technicality.
Wells Fargo, one of the largest home lenders in the U.S., said it it stepping away from the market for home equity lines of credit because of uncertainty tied to the coronavirus pandemic.
“Wells Fargo Home Lending will temporarily stop accepting applications for all new home equity lines of credit (HELOCs) after April 30,” the bank said in a statement.
During tough economic times, HELOCs are riskier products for banks because in a foreclosure, the lender who made the primary mortgage is first in line to get paid in a recovery.
There is a lot of disinformation on the net claiming Covid-19 will only be a minor setback and the job losses are temporary. These so economic "analysts" are basing their opinion not based on facts. Social distancing and half lock down cities will become the norm until a vaccine is out. Which means nothing is returning to normal until mid next year the earliest.
In that time frame we will continue to see a huge job loss not just in retail workers, but small business owners. Small businesses make up 44% of the US economy.
The Fed has come out and stated the Economy will not be back to pre-paramedic levels until 2022. The fed is rarely the bearer of bad news, which means there is a possibility it may take longer for a full economic recovery.
How does this affect the real estate prices? It's hard to say because The Fed has infinite capital and their decisions will dictate the real estate market. What I do know is the federal reserve wants inflation to keep the GDP growth which would include the real estate market.
By Bible Speaks
Origin of the Universe:
Gen. 1:1: “In the beginning God created the heavens and the earth.”
Astronomer Robert Jastrow wrote: “Now we see how the astronomical evidence leads to a biblical view of the origin of the world. The details differ, but the essential elements in the astronomical and biblical accounts of Genesis are the same: the chain of events leading to man commenced suddenly and sharply at a definite moment in time, in a flash of light and energy.”—God and the Astronomers (New York, 1978), p. 14.