As more Americans are returning to the workforce and vaccinations continue to roll out, the nation appears to be headed down the path to normalcy after dealing with a year of COVID-19.
An estimated two million homeowners remain in forbearance plans, according to the Mortgage Bankers Association (MBA). The share of loans in forbearance plans declined for the 17th consecutive week last week, as the MBA’s latest Forbearance and Call Volume Survey reports the total number of loans now in forbearance having decreased by two basis points from 3.93% of servicers' portfolio volume in the prior week to 3.91% as of June 20, 2021.
On Tuesday, June 6, the MBA will release its next Forbearance and Call Volume Survey at 4:00 p.m. ET. Will there be an 18th straight week of forbearance declines?
If this week’s jobs reports is any indication, the downward trend in forbearances may continue.
“Today, the Bureau of Labor Statistics reported that the American economy added 850,000 jobs in the month of June, and the unemployment rate was 5.9%, compared to 5.8% in May,” said U.S. Secretary of Labor Marty Walsh. “With a total of more than three million jobs since President Biden took office, this increasingly strong job growth reflects growing confidence among workers as more people get vaccinated and American Rescue Plan investments provide stability for families, businesses, and communities.”
With that many jobs being added, homeowners are regaining their financial footing, either exiting forbearances plans entirely, while some may be re-entering or re-working their forbearance options.
And in a move that shines a positive light on the housing industry, residential construction employment (including specialty trade contractors) rose by 15,200, a welcome sign for a market currently tight on inventory.
“While residential building construction employment has steadily increased and even outpaced its pre-COVID level, overall construction employment is still 3.1% below its February 2020 level. Attracting skilled labor remains a key priority for construction firms in months to come,” noted First American Deputy Chief Economist Odeta Kushi. “Also important to note that employment for remodelers increased by 12,700 this month. Overall a strong report for residential construction. More hammers, more homes.”
Click here for more information on the MBA’s latest Forbearance and Call Volume Survey.
Here's what else is happening in The Week Ahead:
- CoreLogic’s Home Price Index (Tuesday)
- MBA Weekly Applications Survey (Wednesday)
- Realtor.com Weekly Housing Market Recap (Wednesday)
- Freddie Mac Primary Mortgage Market Survey (Thursday)
- U.S. Department of Labor's Unemployment Insurance Weekly Claims Report (Thursday)
- Black Knight weekly forbearance data (Friday)