States along the East Coast, Connecticut through Florida, as well as Illinois, are more vulnerable to the effects of the Coronavirus pandemic and its continuing impact on the U.S. economy, according to a Q1 2021 Special Coronavirus Report published by ATTOM Data Solutions, while Western States seem better prepared to withstand a downturn.
Markets were considered at greater or lesser risk based on the percentage of homes facing possible foreclosure, the portion with underwater mortgages, and the percentage of average local wages required to pay for major homeownership expenses. (More about ATTOM's methodology is available at ATTOM.com.
The researchers showed 33 of the 50 counties most vulnerable to the economic impact of the pandemic in the first quarter of 2021 were in Florida, Illinois, New Jersey, Connecticut, and North Carolina.
The only three western counties in the top 50 during the first quarter of 2021 were in northern California, while Louisiana was the only southern state outside of the East Coast with more than two counties in that group.
According to ATTOM, first-quarter trends generally build on those found in 2020, but with smaller concentrations around several major metropolitan areas.
"Clearly, the housing market continues to surge, and things are looking up, more and more, for the U.S. economy in 2021, after a year of major setbacks in many sectors. But the pandemic still looms large and may pose a threat to the progress made so far, and by extension could affect home sales and prices," said Todd Teta, chief product officer with ATTOM Data Solutions. "Our analysis suggests that even as the market remains hot, pockets of the East Coast, Midwest and South are at higher risk from potential damage connected to the pandemic. We will stay on top of this as the crucial months ahead should reveal whether the country can leave this crisis behind."
Although foreclosure actions have dipped 80% since this quarter last year, amid a federal and many regional foreclosure moratoria, more than one in 2,500 residential properties faced a foreclosure action in the first quarter of 2021 in 36 of the 50 most at-risk counties, according to the research analysts at ATTOM.
The study's findings, which can be accessed in full at ATTOM.com, according to the authors, "follow one of the housing market's strongest years in the past decade, when the median single-family home price rose more than 10% across much of the nation," ATTOM reported. "They also come at a time of increased financial optimism, with retail sales up in 2021, new unemployment claims down and a second round of federal government stimulus money coursing through the economy. But the pandemic remains a threat to the economy as new virus variants emerge, and additional clusters of new cases crop up in various parts of the country."