The Economic And Housing Impact Of The Coronavirus Pandemic
BREAKING NEWS: The Economic And Housing Impact Of The Coronavirus Pandemic
It is important to understand where the housing market is today and where the housing market may go in the near future.
- The COVID-19 coronavirus outbreak has put a ripple in nearly every industry across the world
- The United States housing market is no exception
- In this blog, we will detail my thoughts and opinions on the COVID-19 outbreak and how it will affect mortgage lending
In this article, we will discuss and cover The Economic And Housing Impact Of The Coronavirus Pandemic.
The Economic And Housing Impact Of The Coronavirus Pandemic On Americans
From the White House coronavirus task force briefing from Sunday, March 29, 2020.
- Dr. Fauci estimates up to 1 million Americans can be infected with COVID-19
- He also added that the virus could cause more than 100,000 to 200,000 deaths but is incredibly hard to predict because the virus is a “moving target”
- Meaning, this can get at least eight times worse than it is today
- We all need to come together and do our part as Americans to keep each other healthy
- From the numbers reported, the virus that originated in China now has more than 732,000 people affected worldwide with about 143,000 of those being in the United States
- This information is according to the John Hopkins University database
- Already we have lost over 2,000 lives in the United States
- Dr. Fauci Stated that we lost over 60,000 people during the annual flu season of 2017 and COVID-19 coronavirus is clearly worse than the common flu season
Nobody wants to see these numbers, but it would not come as a surprise to experts if the death toll gets that high. It is a dark reality to face.
The Economic And Housing Impact Of The Coronavirus Pandemic And Will The Country Recover?
It is no secret that our economy is hurting in a way like never felt before. President Donald Trump announced the continuation of social distancing guidelines through April 30, 2020.
- He has urged Americans to avoid nonessential travel and in-person gatherings of more than 10 people
- From what I am experiencing, there are very few people having gatherings of over 10 people
- The data shows us that the disease is not slowing
- Major cities throughout the country have been hit incredibly hard including New York and New Orleans
- At this time, the virus has not shown signs of leveling off
- There is no exact way to know when the virus will reach its peak
- We hope this happens soon so we can start getting our economy and lives back to normal
- Dr. Fauci also cautioned us that areas with low numbers of infections are not 100% safe
- This virus can spread quickly, and vulnerable areas need to be ready for testing
At this time, it makes sense to pour our resources into heavily affected areas, but keep in mind how quickly this can spread.
Toll On Americans From The Economic Shut Down
In tough times like these, it can be difficult to separate facts from emotions.
- When I watch the news, it is very negative and doom and gloom
- The amount of harm already done to our economy is astronomical
- Many experts say even with the $2 trillion stimulus package put in place by Congress, the economic downfall will take at least 7 to 10 years to recover from
- That is an incredibly long time
- It took about that long to recover from the real estate crash of 2008
- The COVID-19 coronavirus outbreak seems to have a more devastating financial outcome
- This is the first time in the history of the United States where our citizens are asked not to work
- If you’re going to ask millions of people to stay at home and not work, what do you do when your bills are due?
It is no secret that mortgages are always due on the first of the month, which is rapidly approaching in just two days.
Changes Coming In The Mortgage Industry Due To Coronavirus Pandemic Economic Meltdown
At this time there are plenty of rumors that some major players in the mortgage industry are ready to help the American people.
- The long-term effects this may have on the mortgage industry are very difficult to predict
- In these tough times, with thousands of Americans off work, something needs to be done
- Major players such as GINNIE MAE are tossing the idea around of forbearance on mortgage payments
- This can put a huge disruption into the mortgage market
These effects can trickle down into other sectors of the economy such as pension funds and retirement accounts as investments in mortgage-backed securities are part of the plans.
The Economic And Housing Impact Of The Coronavirus Pandemic: Are We Going To Have A Repeat Of The 2008 Mortgage Meltdown?
At this time, mortgage industry officials say they need about 40 billion dollars in federal help over the next three months and over a hundred billion dollars over the next nine months to stay afloat.
- The industry has yet to secure any government help during this economic downfall
- Mortgage servicers were not protected in the 2.2 trillion-dollar economic rescue package
- The Federal Housing Finance Agency (FHFA) who regulates FANNIE MAE and FREDDIE MAC are preparing for many non-bank mortgage servicers to fail
The longer this goes on the higher the probability that Fannie Mae and Freddie Mac will need to add delinquent mortgages to their balance sheets.
Health And Economic Crisis At The Same Time
As stated above, this is simply my opinion, and nothing is set in stone. This is a scary time for the world and the American economy. As citizens from all over come together to help fight the COVID-19 coronavirus, we must continue to put safety first. Yesterday President Trump extended the social distancing requirement through April 30. Unfortunately, many Americans are used to this way of life. At this time, all we can do is hope you stay safe and all of the sick get well. We encourage our readers to follow the social distancing guidelines, continue to wash their hands on a regular basis, and cover their mouths during any coughing or sneezing. It is a group effort from every citizen of our country to help slow the spread of COVID-19 coronavirus. We will continue to bring our readers up to speed on mortgage news surrounding COVID-19. You may see a slow in on our YouTube CHANNEL as we continue to practice social distancing. For any mortgage questions, please call Mike Gracz on 630-659-7644 or email me at [email protected]