CoreLogic September Report
By Andy Cruz
The focus of this week’s blog is to discuss delinquent payments and foreclosures around the country, as reported by the most recent CoreLogic September analysis report. (Click here to read the full report)
As you will see, the states with the highest rate of delinquencies are also states, which currently have Unemployment rates notably higher than the national average of 3.7%.
State Delinquency Rank Unemployment Rate Unemployment Rank
Mississippi 1 5.2% #2 (second only to Alaska)
Louisiana 2 4.3% #8
West Virginia 5 4.6% #5
**Report Note: It was noted that each of these states experienced abnormal weather events, which caused higher than normal structural damage.
- The 3 states listed above are in the Top 5 states for percentage of delinquencies AND are in the Top 10 in unemployment rate in the country.
- The states with the low mortgage delinquencies have correlating low unemployment: Idaho (43rd), North Dakota (49th), Colorado (46th) for example.
Even though this report does not include our market area of San Diego, the indicators we look at to forecast foreclosures are still the same. We look at things like unemployment, unexpected weather events, and other economic variables that indicate whether we are at the tipping point of a problem or not.
We also owe it to ourselves to look at home price increases over time. As the CoreLogic report shows, home price increases have slowed. Remember, they are referring to increase of value still, it does not mean that values have stopped increasing or have even began to decrease. It’s also notable that any areas where there were home value declines, it was because of specified circumstances abnormal to a traditional real estate cycle.
So what does this mean for us? I believe it means is we can expect mortgage rates to remain low until we see a substantial correction in the overall marketplace – AND – we see a change in home prices. As home prices increase, so does the cost of the monthly mortgage payment. And a real estate slow down would only happen quickly if you home values rise quickly, at the same time interest rates rise quickly, at the same time inventory rises quickly. And since those circumstances are not moving in the same direction at the moment, it is safe to say that we will be in a steady market for the months ahead.
For those of you that live here in San Diego, it is imperative to take a look at your home’s value to determine how much equity you might have in the market right now. This could lead to a sale decision or even a refinance decision to better your overall financial picture for the long run. If you do not know the value of your home, you can click here and sign up for our reports with local market data specific to your address. If you have been kicking around the idea of refinancing to lower your rate, lower your monthly payment, pay off debt, reduce your loan term or for any other reason, we can at least have a strategic conversation to help you decide whether you should proceed or not. Please let us know how we can help you.