Even as overall delinquencies decreased, early-stage delinquencies saw an uptick after last year’s active hurricane season, according to the latest Loan Performance Insights Report from CoreLogic, a property information, analytics and data-enabled solutions provider.
Nationally, 5.1% of mortgages remained in some stage of delinquency, those 30 days or more past due including homes in foreclosure, in October. This is down 0.1 percentage point from October 2016 when 5.2% of all homes with a mortgage were in a stage of delinquency.
The foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, decreased 0.2 percentage points from last year’s 0.8% to 0.6% in October. The foreclosure inventory rate has remained at 0.6% since August of 2017, and represents the lowest level since June 2007.
However, CoreLogic explained that measuring early-stage delinquencies is important for analyzing the health of the housing market, and these delinquencies increased slightly in October.
The rate of early-stage delinquencies, those 30 to 59 days past due, fell 0.1 percentage point from October 2016 to 2.3% in October. But this is up 0.1 percentage point from 2.4% in September.
“After rising in September, early-stage delinquencies declined by 0.1 percentage points month over month in October,” CoreLogic Chief Economist Frank Nothaft said. “The temporary rise in September's early-stage delinquencies reflected the impact of the hurricanes in Texas, Florida and Puerto Rico, but now the impact from the hurricanes is fading from a national perspective.”
“While the national impact is waning, the local impact remains,” Nothaft said. “Some Florida markets continue to see increases in early-stage delinquency transition rates in October, reaching 5%, on average, in Miami, Orlando, Tampa, Naples and Cape Coral. Texas markets such as Houston, Beaumont, Victoria and Corpus Christie peaked at over 7% in September, but are on the mend and improving in October.”
The share of mortgages 60 to 89 days past due in October was 0.9%, up 0.2 percentage points from 0.7% in both September and October 2016. The serious delinquency rate, or loans 90 days or more past due, was 1.9%, unchanged from September and down 0.4 percentage points from 2.3% in October 2016 and the lowest rate since October 2007.
“While the national impact of the recent hurricanes will soon fade, the human impact will remain for years,” CoreLogic President and CEO Frank Martell said. “For example, the displacement and rebuilding in New Orleans after Hurricane Katrina extended for several years and altered the character of the city, an impact that still remains today.”
“The reconstruction of the housing stock and infrastructure impacted by the storms should provide a small stimulus to local economies,” Martell said. “This rebuilding will occur against a backdrop of wage growth, consumer confidence and spending in the national economy which should continue to provide a solid foundation for real estate demand in the storm-impacted areas and beyond.”