The question on many minds is whether the government will issue more stimulus checks to people or will there be more government programs to stimulate the economy. The country’s reopening of the economy became stalled as the Coronavirus re-surged in many states. Unemployment remains higher than normal.

Adding to the stress of the economy is that enhanced unemployment benefits are set to expire later this month. None of that addresses the impending economic doom of missed house payments and evictions from housing.

The delinquency rate on rent payments has hovered from a low of 0.71% during the second quarter of 1995 to a high of 2.52% during the third quarter of 2009. The delinquency of home mortgages has likewise hovered from a low of 1.89% in the second quarter of 1999 to a high of 11.53% in the first quarter of 2010. In both cases, the delinquency rate was generally low between 1991 and the first quarter of this year. For rents the average rate was around 1% and for mortgages it as about 2%.

Credit card delinquencies hovered from about 2% to almost 5% during the same period.

A recent American Housing Survey suggests that the pandemic has decimated the previous low delinquency rates. According to the survey, 25% of renters have failed to pay their rent on time. Mortgage delinquencies, according to the survey, has jumped to “over 23 percent”. [emphasis mine]

Evictions have been stalled due to emergency stays imposed by most communities but many of the stays have been lifted by their respective governments. For example, Florida’s eviction hold ends on August 1. Texas lifted the eviction holds in June.

With the pending housing crisis and the resulting economic stress, will Congress issue more stimulus checks is the question on many minds.

Senate Majority Leader Mitch McConnell has signaled that he supports another pandemic rescue package. What the next stimulus package will look like is still unknown as Congress has yet to offer any details.

The economy is essential for the country’s well being. Part of the rush to reopen the schools is to stimulate the economy by generating school expenses like energy use, the cost of supplies and the other associated expenses with getting the children to school. However, the most important component of reopening the schools is the idea that the fear of the pandemic is now over and the economy should be reignited. That, and allowing parents to resume normal lives by going to work and resuming normal activities that stimulate the economy.

But no amount of school reopening plans can offset the crisis of families facing being homeless.

Delinquency rate source: Board of Governors of the Federal Reserve System.