Key Highlights

  • According to latest survey by Mortgage Bankers Association, +5% of Americans didn’t make mortgage or rent payment in December
  • Percentage translates into some 5M mortgage holders or renters

Evidence of Economic Damage in Nation’s Housing Sector Caused by COVID and Ancillary Business Shutdowns

The latest survey just released by the Mortgage Bankers Association’s (MBA) Research Institute for Housing America indicates that approximately 5M, or more than 5% of the total mortgage holders and renters, did not make a monthly housing payment in December.

 On top of the some 5M making no housing payment in December, another 2.3M renters and 1.2M mortgagors believe they are at risk of eviction or foreclosure (regardless of eviction/foreclosure moratoria extensions through March 31), or would be forced to move in the next 30 days.

Data Specifics

Though fewer households were behind on their housing payments in December 2020 than June 2020, 2.6M renters missed, delayed or made delayed payments in December.  Some 2.4M homeowners missed their monthly mortgage payment in December.

Data from the US Census Bureau’s Household Pulse survey is consistent with that taken by the MBA. As of January 18, the Census Bureau’s survey found that approximately 6M adults fear eviction or foreclosure in the next two months.

Rental Property Owners Bearing the Brunt of Unpaid Housing Bills

Owners and landlords of rental property are shouldering the brunt of unpaid monthly rental bills.  In Q4 2020, rental property owners lost nearly $7.2B from missed rent payments, according to the MBA.

MBA Survey Indicated Fewer Homeowners Feared Losing their Homes

According to the MBA survey, fewer homeowners were afraid of losing their homes at the very end of Q4 2020.  Gary Engelhardt, an economics professor in the Maxwell School of Citizenship and Public Affairs with Syracuse University, said that the Biden Administration commitment to government aid via “…direct checks and enhanced unemployment benefits, rental assistance, mortgage forbearance programs, and a federal eviction moratorium have so far been effective in keeping people in their homes.”

No one is talking about any proposal to assist rental property owners being asked to shoulder unpaid housing bills completely on their own.

 

Thanks to Bloomberg, MortgageBankersAssociation, and US Census Bureau.