Which U.S. States Have Fared the Best and Worst, Financially, During COVID-19?
During the ongoing pandemic, some states have fared better than others economically, and now we have firmer data on that front.
A new study from Bankrate shows that Nevada’s economy has suffered the most serious decline among U.S. states.
The data comes from Bankrate’s Housing Hardship Index, which used May mortgage delinquency rates from Black Knight and May unemployment rates from the U.S. Department of Labor, to rate the states economically.
“Nevada’s mortgage delinquency was 9.99% (5 highest) and unemployment was 25.3% (highest overall), making the state’s overall Housing Hardship reading 35.29. Mortgage delinquency in May was up from 7.97% in April, while unemployment fell from 28.2%. Nevada’s economy also fared the worst in April according to Bankrate’s index,” the report stated.
After Nevada, the states suffering the worst financial fallout are Hawaii, Michigan, New Jersey, and Rhode Island. Hawaii had the next largest jobless number, at 22.6%, while New Jersey had the highest mortgage delinquency rate, at 10.49%.
The states in the best financial shape during COVID-19 are South Dakota (#1), followed by North Dakota, Montana, Idaho, and Nebraska.
Nebraska, had a 6.12% mortgage delinquency rate (16 lowest) and 5.2% unemployment rate (lowest overall), for a total score of 11.32.
“States experiencing high unemployment will see mortgage delinquencies surge if unemployment remains elevated as forbearance periods expire,” says Greg McBride, CFA, Bankrate chief financial analyst. “This year may see the worst for unemployment, but 2021 will likely bring the worst for mortgage delinquencies and defaults.”
For now, foreclosures remain rare, Bankrate reports, but major government agencies are gearing up for the storm.
“Mortgage giants Fannie Mae, Freddie Mac and the Federal Housing Administration unveiled forbearance programs that allow borrowers to miss up to a year of payments without penalty,” the report stated. “Real estate markets are local, as the saying goes, and the Housing Hardship Index indicates which regions may face protracted recoveries, and which areas might emerge comparatively unscathed.”
That's not the good news we're looking for heading into a holiday weekend, but they're the facts on the ground. Better to be ready than surprised, as the old saying goes.