Mortgage Delinquency Rates Drop, Can You Still Get A Deal on Real Estate?

Everybody’s looking for a steal, and I can tell you as far as the Real Estate industry goes, it used to be a lot easier to accommodate. Home Buyers scouring the market for deals are having a much more difficult time finding one. Due to a shortage of foreclosures and the virtual non-existence of short sales, it’s been necessary for Home Buyers and property investors to adjust their definition of a bargain. Bargains nowadays might include fixer-uppers in pricier neighborhoods, homes in areas that are in the beginning stages of gentrification, property in outlying cities and towns in the path of urban-creep, and the occasional listing that has languished on the market much longer than the norm. But I can’t necessarily conclude that this is a bad thing.

In a stable or stabilizing market there is an amicable balance between Sellers and Buyers. Difficulty finding a deal is an indication of market equilibrium. This bodes well for the Real Estate industry, lenders, and whether you want to believe it or not, Home Buyers as well. After all you, as a Home Buyer, will soon be a Home Owner and eventually a Home Seller. Wouldn’t you rather own a home in a solid, i.e. profitable, market?

So how do we keep the market steady and balanced? It all starts with lower mortgage delinquency rates, meaning fewer foreclosures. In the piece below, Zoe Eisenberg cites data collected and compiled by CoreLogic, a trusted provider of financial, property and consumer information. The piece was prior to the recent government shutdown of course, and I’m sure there will be a slight upward blip in mortgage delinquency numbers as a result, but overall the health of the mortgage industry is the strongest we’ve seen in more than a decade.

Delinquency Rates Drop to Lowest Level in 18 Years

By Zoe Eisenberg

Things are looking up for mortgage delinquency rates across the country, according to a recent report from property information and analytics provider CoreLogic. The company’s October Loan Performance Insights Report showed that only 4.1 percent of mortgages nationally were in some stage of delinquency, as defined by 30 days or more past due, including those in foreclosure.

The report also revealed that the foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, settled at 0.5 percent, down 0.1 percent since October 2017—the lowest for any month since September 2006 and also the lowest rate for an October since 2005. In both instances, the foreclosure inventory rate was 0.5 percent.

What’s more, these numbers seem to be trending. The October 2018 foreclosure inventory rate tied with the April, May, June, July, August and September rates this year for the lowest for any month since September 2006.

Natural disasters made their mark on delinquency rates, according to CoreLogic.

“Despite some regional spikes related to hurricane and fire impacted areas, overall delinquency rates are near or at historic lows,” says Frank Martell, president and CEO of CoreLogic.

Frank Nothaft, chief economist for CoreLogic, echoes Martell’s sentiment: “While the strong economy has helped families stay current and push overall delinquency rates lower, areas that were hit hard by natural disasters have seen a rise in loan defaults. The 30-day delinquency rate in the Panama City, Fla., metro area tripled between September and October 2018 as a result of Hurricane Michael.”

Below is a year-over-year overview of loan performance across the U.S. in October:

Credit: CoreLogic

To view the full results and a breakdown of the company’s methodology, visit CoreLogic.com. This appeared first on RISMedia’s Housecall. Zoe Eisenberg is RISMedia’s senior content editor. Email her your real estate news ideas at zoe@rismedia.com. Reprinted with permission from RISMedia. ©2019. All rights reserved.