Foreclosure rates in March hit their lowest reading for the month in at least 20 years, while overall and serious delinquency rates also achieved 13-year lows for the same period, according to CoreLogic.
The foreclosure inventory rate, which accounts for mortgages in any stage of foreclosure, ticked down 0.2 percentage points to 0.4% in March from a year ago. This is the fifth consecutive month the rate has held at 0.4%, and marks the lowest it has been for any March since 1999.
Overall, 4% of mortgage loans were in some stage of delinquency in March, down from 4.3% a year ago.
A healthier economy is a likely contributor to better behavior from borrowers. The share of consumers reporting their household income was significantly higher in March from the prior year grew 3% annually to 20%, according to Fannie Mae. And 80% claimed they were confident in not losing their job over the next 12 months, which is up 9% from the previous year.
“Delinquency rates and foreclosures continue to drop through March and should decline further in the months ahead barring any serious dislocations from recent flooding in the Midwest or a severe Atlantic hurricane and/or wildfire season on the coasts,” Frank Martell, CoreLogic’s president and CEO, said in a press release.
Certain regions did post increases in their delinquency rates, with the greatest gains being in those that had more recently suffered from natural disasters. Among states posting stronger growth in delinquency rates were hurricane-affected areas in the Southeast (Florida, Georgia and North Carolina) and in the Chico, Calif., metro area, which was devastated by last year’s Camp Fire.
While the national delinquency rate was down overall, 21 states did see some sort of increase, though their development should be limited going forward.
“The increase in the overall delinquency rate in 42% of states most likely indicates many Americans were caught off guard by their expenses in early 2019. A strong economy, labor market and record levels of home equity should limit delinquencies from progressing to later stages,” said Frank Nothaft, chief economist at CoreLogic.