Fun

US Real Estate Market Crisis: 4.3 Million Mortgage Delinquencies, Commercial Properties Sink in Value

News Feed - 2020-06-28 01:06:44

US Real Estate Market Crisis: 4.3 Million Mortgage Delinquencies, Commercial Properties Sink in Value


The U.S. economy continues to look bleak as the American citizens and small businesses nationwide struggle to keep up with the government’s rules toward Covid-19 guidelines. In just 13 weeks, over 45 million Americans filed for unemployment benefits and many citizens cannot pay their mortgages. Numbers stemming from last month’s property data indicates that about 4.3 million Americans didn’t pay their mortgage notes.


While precious metals like gold and silver have done well, and crypto assets have held decently, real estate and property statistics have tumbled. The government in America has continued to ravage the U.S. economy by inducing a number of lockdown rules and shutting down businesses of all shapes and sizes.


The unemployment rate is practically parallel with the numbers from the Great Depression as 45.7 million are out of work. And that number only accounts for Americans who can file as members of the gig economy and other types of workers cannot collect.


Additionally, the extra $600 extra from the CARES Act unemployment benefits will end soon. “The (Federal Pandemic Unemployment Compensation) $600 can be paid for weeks ending no later than the week ending prior to Friday, July 31, 2020,” the U.S. Department of Labor told the public. “For all states except (New York), that is Saturday, July 25th. New York’s end date is Sunday, July 26th.”


With all the lockdown orders and business shutdowns, it’s put the U.S. real estate industry in jeopardy as home sales and commercial property values have plummeted.


This week it was reported that 4.3 million U.S. citizens didn’t pay their mortgages in May and it’s a huge spike. The number is up over 2 million since the end of March and the delinquency rate is reaching a point not seen since the 2008 subprime mortgage crisis. Average citizens can’t pay their notes and apartment rentals in all major cities are not being contracted for the fall months.“Another 723,000 homeowners became past due on their mortgages in May, pushing the national delinquency rate to its highest level in 8.5 years,” says Black Knight data. “There are now 4.3 million homeowners past due on their mortgages or in active foreclosure – including those in forbearance who have missed scheduled payments as part of their plans – up from 2 million at the end of March. Serious delinquencies are on the rise as well, increasing by more than 50% over the past two months.”


Reports also show that the Covid-19 induced lockdown economy is like a wrecking ball smashing the $17 trillion U.S. commercial real estate market. The fact of the matter is real estate is not selling at all like it was 13 weeks prior to the virus outbreak.


Even office rentals are feeling the heat as a recent Morgan Stanley report disclosed dire pricing power losses for landlords. Morgan Stanley also expects the vacancy rate to rise all the way until 2024.


Barry Sternlicht from Starwood Capital detailed that he predicts office buildings to lose 40% of value, rents dropping extremely low, and a third of hotels going bankrupt in New York City.


The National Association of Realtors explained on Monday that “existing-home sales occurred at a seasonally adjusted annual pace of 3.91 million,” which is the lowest in over a decade. Sales that stem from pre-owned houses dipped by 9.7% in May.


Many economists are fixated on the real estate market because they believe it could explode like it did after Lehman went bankrupt. Amid the telltale signs of a worsening U.S. real estate market, American first time home buyers (FTHBs) have been focused in on the real estate dips too.


As any American can see by scrolling through Zillow or any property listing platform that prices are being slashed left and right. Genworth Mortgage Insurance has published a reportthat shows FTHBs are taking advantage of the lows. The report shows that FTHBs didn’t do well in April but in May numbers were impressive.


Despite the gloom and doom from headlines that indicate 4.3 million Americans haven’t paid their mortgages, some realtors are still very optimistic.


“Home sales will surely rise in the upcoming months with the economy reopening, and could even surpass one-year-ago figures in the second half of the year,” said Lawrence Yun, chief economist for the National Association of Realtors (NAR), in the organization’s report published on Monday.


Another thing analysts are watching is pending home sales as there have been a number of homes sitting in limbo. It’s quite possible that due to the lockdown and business shutdown guidelines that many people who were about to purchase a home 13 weeks ago cannot now. Analysis shows that a number of transaction closings, settlement, and pending sales nationwide continue to remain frozen as well.


What do you think about the U.S. real estate market? Let us know in the comments below.Analysts Say Bitcoin Breakout Imminent: Silver-like Suppression, $5 Trillion in Cash Could Flow Into BTCFINANCE | Jun 18, 2020US Financial Services Committee Hearing Discussed the Creation of a "Digital Dollar"FINANCE | Jun 12, 2020Tags in this story4.3 million U.S. citizens, apartment rentals, Bitcoin, commercial real estate, Coronavirus, COVID-19, crypto assets, Economy, Existing Homes, Finance, Genworth Mortgage Insurance, gold, Lawrence Yun, morgan stanley, National Association of Realtors, Property Sales, Real estate, Zillow


Image Credits: Shutterstock, Pixabay, Wiki CommonsSpot-markets for Bitcoin, Bitcoin Cash, Ripple, Litecoin and more. Start your trading here.Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.Read disclaimer Show comments

News Feed

Judge denies SEC attempt to hamper Tron’s defense amid dismissal ploy
Martin Young4 hours agoJudge denies SEC attempt to hamper Tron’s defense amid dismissal ployJustin Sun and his associated companies are “not challenging the ‘common enterprise’ element of the Howey test,” ruled
From Buenos Aires to Beirut – Covid-19 Excuse Restricts Millions of Citizens from Withdrawing Their Own Money
From Buenos Aires to Beirut - Covid-19 Excuse Restricts Millions of Citizens from Withdrawing Their Own MoneyThe coronavirus and the government-induced lockdowns have wreaked havoc
Savannah Fortis14 hours agoSBF’s lawyers ask court to allow introduction of Anthropic evidenceSam Bankman-Fried’s lawyers asked Judge Kaplan in a letter to allow the defense to use evidence of its venture investment
US military partner Constellation opens Hypergraph network to app developers
Alex O’Donnell2 hours agoUS military partner Constellation opens Hypergraph network to app developersThe “Layer 0” network was created in collaboration with the United States Department of Defense and is now open f
Helen Partz13 hours agoStablecoin firm Tether minted 4B USDT in 4 weeks: DataTether has minted 4 billion USDT over the past month, which accounts for nearly 18% of all USDT issued so far in 2023.3551 Total views14 Total
Marcel Pechman4 hours agoWas Chainlink’s (LINK) 35% rally just a buy rumor, sell the news event?LINK outperformed most cryptocurrencies in September, but the recent correction raises questions on the sustainability of
Savannah Fortis12 hours agoPrime Trust bankruptcy spotted by crypto community months aheadMonths before Prime Trust filed for Chapter 11 bankruptcy, online sleuths in the crypto community were on the case and continue to
Biggest Movers: ATOM, DOT Hover Below Key Resistance Levels on Saturday  
Biggest Movers: ATOM, DOT Hover Below Key Resistance Levels on Saturday   ATOM and DOT were trading in a sideways trend on Saturday, as crypto markets were mainly in consolidatio
Brazil poised to launch world’s first spot Solana ETF ahead of global markets
Zoltan Vardai11 hours agoBrazil poised to launch world’s first spot Solana ETF ahead of global marketsAccording to IBM’s former blockchain growth lead, a potential Solana ETF approval in the US could act as a signifi
Gareth Jenkinson10 hours agoPolygon 2.0 — MATIC conversion to POL outlined in preliminary improvement proposalsThe Ethereum layer-2 developer has introduced the first improvement proposals to begin the transition to it
Gareth Jenkinson12 hours agoAI’s energy consumption concerns echo Bitcoin mining criticisms, says Heatbit founderWhile artificial intelligence continues to grab headlines, small and large-scale Bitcoin miners might not
Big miners pose a growing existential threat to Bitcoin
Kadan Stadelmann2 hours agoBig miners pose a growing existential threat to BitcoinAs of May, AntPool and Foundry USA controlled more than 50% of Bitcoin"s hash rate. That could become a problem for Bitcoin users in the n