Even though last year’s hurricane season is behind us, the aftermath from 2017’s damaging storms continues to be felt both on the ground where the storms made landfall and throughout the housing and mortgage industry still dealing from the fallout of so many people losing or having their homes severely damaged. Unsurprisingly, given the sheer number of people affected, early-stage mortgage delinquencies spiked during September 2017, after Hurricane Harvey had blown through. The latest CoreLogic’s Loan Performance Insights report, however, shows the beginnings of a recovery from the storms in October 2017.
CoreLogic reports that early-stage delinquency rates peaked at over 7 percent in some Texas markets during September 2017, as the Lone Star State dealt with the impacts of Hurricane Harvey’s landfall in August 2017. According to the National Oceanic and Atmospheric Administration’s National Centers for Environmental Information, Hurricane Harvey caused an estimated $125 billion in damages. Hurricanes Irma and Maria followed Harvey in September, causing another $50 billion and $90 billion in damages, respectively.
However, CoreLogic’s Loan Performance Insights Report shows early-stage mortgage delinquencies declining slightly in October 2017, decreasing 0.1 percent month-over-month.
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,” said Frank Nothaft, Chief Economist at CoreLogic. However, some markets are obviously still reeling from the natural disasters, and Nothaft notes that early-stage mortgage delinquency rates averaged around 5 percent in Florida cities such as Miami, Orlando, Tampa, Naples, and Cape Coral.
Frank Martell, President and CEO of CoreLogic, also forecasts that reconstruction in these affected areas will boost the local economy in the short term. Martell says, “The reconstruction of the housing stock and infrastructure impacted by the storms should provide a small stimulus to local economies. This rebuilding will occur against a backdrop of wage growth, consumer confidence, and spending in the national economy which continue to provide a solid foundation for real estate demand in the storm-impacted areas and beyond.”
Nationwide, the 30-day-plus mortgage delinquency rate was 5.1 percent in October 2017, down from 5.2 percent in October 2016. The national foreclosure inventory rate in October 2017 was 0.6 percent, down from 0.8 percent in October 2016. The share of mortgages nationally that transitioned from current to 30 days past due was 1.1 percent in October 2017, an increase of .01 percent year-over-year.
On the serious delinquency front, for mortgages that are 90 days or more past due, only Alaska saw its serious delinquency rate increase year-over-year in October 2017, climbing to 1.1 percent in that month, as compared to 1.0 percent in October 2016. All other states saw their serious delinquency rates decrease year-over-year, with the exception of Texas, which remained flat at 1.9 percent.
You can read the latest CoreLogic Loan Performance Insights Report in full by clicking here.