Just under 5 million households failed to pay rent or mortgage payments in the second quarter of 2021, according to updated research published today by the Mortgage Bankers Association (MBA) Housing Research Institute of America (RIHA).
Study, Housing financial crisis during a pandemic, found that 8.6% of tenants (2.86 million households) missed, delayed, or made a cut payment in June 2021, while 4.6% of homeowners (2.19 million) missed mortgage payments.
“Given the level of government support during the pandemic and recent improvements in the economy and labor market, it is possible that observed levels of rent nonpayment could be at or close to pre-pandemic levels,” said Gary W. Engelhardt, professor of economics at the School. Maxwell Citizenship and Public Relations at Syracuse University. “However, the recent rise in COVID-19 cases and increased inflationary pressures could slow economic growth and hiring. These potential barriers can also affect households that still face difficulties. ”
Since the start of the pandemic in the second quarter of 2020, 6.8% of renters and 5.7% of homeowners have missed four or more payments. Missed rent payments are now $ 41.7 billion and unpaid mortgage payments are $ 76.5 billion.
“The employment situation of homeowners and their ability to pay mortgage payments has improved significantly since the start of the pandemic,” said Edward Seiler, executive director of RIHA and MBA deputy vice president for housing economics. “Most of the homeowners who still haven’t paid their payments are on a mortgage waivers plan. For those still struggling after the abstinence plan expires, changing the loan, deferring payments, and paying off the loan – through refinancing or selling a home – are all options that can get in the way of foreclosure. ”
Some of the key findings of the study:
- In the second quarter of 2021, slightly fewer tenants and homeowners missed payments compared to the first quarter. However, more tenants and homeowners missed payments in June than in March: 2.86 million tenants (8.6%) and 2.19 million (4.6%) mortgages missed payments in June, compared with 4.53 million households. who missed payment in March (7.2% of tenants). and 4.5% of pledgers).
- Property owners continue to play a key role in helping tenants: 11% of tenants missed one payment in 15 months of the pandemic, 4.4% missed two payments, 2.7% missed three payments, and 6.8% missed four or more payments. Overall, rental property owners lost $ 7.10 billion in revenues in the second quarter due to non-payment of rents. That’s below $ 7.48 billion in the first quarter of 2021.
- Since the second quarter of 2020, homeowners are the least likely to miss a payment: 85.4% of mortgages made all their mortgage payments, 5.6% missed one payment, 1.9% missed two payments, 1.4% missed three payments, and 5.7 % missed four or four payments. more payments.
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