More Americans Missing Mortgage Payments
One of the genuine "red flags" that the U.S. economy is in peril are housing payments - and right now, many Americans aren't making them. A new study from Apartment List tells the tale.
"As the COVID-19 pandemic continues to freeze much of the economy, record layoffs are driving an unprecedented spike in missed rent and mortgage payments," the report noted.
After surveying over 4,000 Americans, Apartment List’s latest report finds 31% of respondents failed to make their full May housing payments, up from 24% in April. What's more, 16% of those who were able to make their full housing payment on time in April haven’t yet been able to pay anything in May.
This from the report:
- 22% of respondents have not yet made a housing payment for May, and an additional 9% have made only a partial payment. Missed payments remain common for renters and homeowners alike.
- More than half of households that couldn’t pay their April bill on time eventually closed the gap with late payments. By the end of the month, just 9% of Americans left a portion of their April rent or mortgage unpaid.
- Working from home continues to be a key factor in affording your rent or mortgage. Remote workers had the lowest May delinquency rate (20%) among any group that we surveyed.
- Despite May’s missed payments, optimism is improving. This month, a greater share of respondents said they are confident they will be able to continue affording housing through June, despite shelter-in-place restrictions.
The Kitchen Table Economist will keep a sharp eye on next month's housing payment data. Any more upward spikes will be a sign that the U.S. economy is in no rush to recover - and that the dreaded "F" word - foreclosures - will rear it's ugly ahead.