Posts Tagged ‘unemployment’

Americans Waiting for a Bigger Raise

Posted on November 17, 2017 by Laura Lam

The government said that average hourly earnings rose 2.4% over the past 12 months.  That’s a slip from the 2.9% increase reported in September. It remains below the 3% to 3.5% range that many agree is normal in a truly healthy economy.  The last time wages were up more than 3% year-over-year was in April 2009, just as the economy was emerging from the depths of the global banking crisis that fueled the Great Recession. Why have wages remained stagnant even though many other indicators of the job market and broader economy look healthy? Unemployment continues to drop. The housing…

Sales to First-Time Home Buyers Fell 34% in 2017

Posted on November 16, 2017 by Laura Lam

First time homebuyers continue to struggle to enter the housing market amidst limited housing inventory, falling to the fourth lowest level since 1981, according to the National Association of Realtors’ 2017 Profile of Home Buyers and Sellers report.  The share of first time homebuyers in the housing market decreased from 35% in 2016 to 34% in 2017. In the 36-year history of NAR’s report, the long-term average of first-time homebuyers rests at 39%. “The dreams of many aspiring first-time buyers were unfortunately dimmed over the past year by persistent inventory shortages, which undercut their ability to become homeowners,” stated NAR…

FHA Loan Delinquency Rate Flattens

Posted on November 09, 2017 by Laura Lam

Closed-end loans continue to return to normal levels as overall consumer delinquencies remained steady and serious delinquency rates remained near the 10-year low.  However Federal Housing Administration loans delinquency rates seem to be slowing down.  FHA loans, popular among first-time home buyers with affordability constraints, have made steady improvements this year but may be reaching a plateau. Loans 90-days delinquent, in foreclosure or involved in bankruptcies remained stable at 4.31% in August. The seasonally adjusted estimate was 5.2% a year ago.  Even though delinquencies have been improving, FHA loans continue to make up a large percentage of the distressed loans…

Credit Card Delinquencies Are Rising

Posted on November 01, 2017 by Laura Lam

While it’s easy to ignore when the stock market is at record highs and unemployment is reassuringly low, household debt is on the rise.  The Center for Microeconomic Data’s (CMD) latest Quarterly Report on Household Debt and Credit reveals that total household debt rose by $114 billion (0.9%) to $12.84 trillion in the second quarter of 2017.  This increase put overall household debt $164 billion above its peak in the third quarter of 2008, and 15.1% above its trough in the second quarter of 2013 Consumer debt, in many ways, should generate more concern – during the good times.  The persistence of…

Delinquency Rate Continues at 10-year Low

Posted on October 26, 2017 by Laura Lam

CoreLogic released its latest Loan Performance Insights report on national foreclosure and delinquency activity earlier this month.  According to the report, the share of mortgages that transitioned from current to 30-days past due was 0.9% in July 2017, down from 1.1% in July 2016. CoreLogic compares this to January of 2007 when “just before the start of the financial crisis, the current-to-30-day transition rate was 1.2% and peaked in November 2008 at 2%.” In addition, it is noted that 4.6% of mortgages were in some stage of delinquency in July 2017 – a 0.9 percentage point year-over-year decline in the…

Housing Confidence on the Rise; Renters Optimistic

Posted on October 25, 2017 by Laura Lam

The Fannie Mae Home Purchase Sentiment Index (HPSI) increased 0.3 points in September to 88.3, matching the all-time high set in June. The rise can be attributed to increases in 3 of the 6 HPSI components. The good time to buy component rose the most month-over-month, with the net share increasing 10 percentage points compared to August. Renter respondents, in particular, buoyed the net good time to buy component, showing a substantial upward change in optimism in September. The net share who reported that now is a good time to sell a home rose 2 percentage points in September and…

Mortgage Default Rates Begin to Rise

Posted on October 24, 2017 by Laura Lam

Mortgage defaults in September were slightly higher than in the previous month and are still lower than a year ago but they are closer to matching levels seen in 2016.  The default rate for first mortgages last month was 0.66%, up a basis point from August, but down a basis point from September a year ago, according to Standard & Poor’s and Experian. Second-mortgage default rates were three basis points higher on a consecutive-month basis at 0.53% but were 3 basis points lower year-to-year.  The composite default rate for mortgage, bank card and auto loan credit was up 2 basis points from…

Banks Prepare for Credit Card Defaults

Posted on October 20, 2017 by Laura Lam

Credit card delinquencies increased for three consecutive months, adding to signs that consumers in the U.S. are having a tough time paying their debt.  According to recent reports, credit card data from JPMorgan, Discover Financial Services and Bank of America show that the number of delinquencies is on the rise. The reason for the uptick in the number of people who can’t pay their credit card bills is due to lenders going after consumers with less-than-stellar credit ratings. Although this practice is intended to fuel growth in a low-interest rate environment, the lower credit quality is coming back to bite…

Boomers Struggle to Pay Off Mortgages Before Retirement

Posted on October 17, 2017 by Laura Lam

While outright homeownership increased among Baby Boomers after the last recession, they still lag previous generations, and may never catch up, according to the Fannie Mae Economic and Strategic Research Group’s latest Housing Insight Series.  Older generations such as Baby Boomers have criticized Millennials for waiting longer than their generation to buy a home, however even Boomers are failing to keep up with the pace set by the generation before them. Baby Boomers are much less likely to own their home outright than the generations before them and may struggle to catch up before reaching retirement age.  According to the report, “The leading…

Consumer Delinquencies Improve in 2Q

Posted on October 16, 2017 by Laura Lam

Delinquencies in closed-end loans held steady in the second quarter as bank card delinquencies fell and home-related categories continued their return to normal levels, according to results from the American Bankers Association’s Consumer Credit Delinquency Bulletin. Overall, delinquencies fell in 8 of the 11 individual consumer loan categories.  The composite ratio, which tracks delinquencies in 8 closed-end installment loan categories, remained at 1.56% of all accounts – well below the 15-year average of 2.16%. “Delinquencies remain below historical levels as consumers continue to show great command of their finances,” said James Chessen, ABA’s chief economist. “The outlook remains very positive,…