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UBS Warns Americans Can No Longer Afford Mobile-homes

edsl48

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by stockboardasset

A little over a month ago, after we first brought the market’s attention to the crisis quietly unfolding in consumer debt, Business Insider has finally caught up, acknowledging that “lower-income consumers and younger borrowers with substantial student debt moving at a slower pace than more affluent and established participants.” In other words, Bussiness Insider describes the economy as running at ‘two speeds,’ and mentions an ominous warning sign that lower-income consumers are entirely tapped out.

Without consumption, the US economy would collapse. Consumption accounts for about 70 percent of US GDP. Further, there are some 95 million Americans out of the labor force. The rosy narratives of how millennials and low-income consumers are propping up the economy are starting to fade, as Business Insider through a new UBS report —provides the knowledge that the “mobile-home market is showing signs of stress.”

According to the consumer research desk at UBS, Americans can no longer afford mobile-homes, as the delinquency rate on these tiny trailers has soared two percentage points, over the past year. In fact, what is even more mindboggling, is the 30-day-plus delinquency level is now about five percent, not seen since the first quarter of 2005 or a few years after the dot-com bubble.

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The recent surge in the number of struggling mobile-home borrowers is a new phenomenon. It hints at severe wealth inequality and a divided labor force that has left millions of Americans behind. Nevertheless, this is all occurring as the unemployment rate is hovering near record lows.

“We interpret this data to mean that these individuals have not largely benefitted from these macro-dynamics, and may also be disproportionately exposed to industries that have experienced compression — rather than expansion — in the current economic conditions, such as retail or some areas of energy extraction,” UBS said.​
During the 2016 presidential campaign of Donald Trump, mobile-home delinquencies spontaneously erupted, as conventional single-family residential loan delinquencies stayed stagnate.

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Business Insider said, “this data represents a piece of a jigsaw puzzle of the condition of consumer finances.” According to UBS, the picture that is emerging for the lower-income consumers and younger borrowers should serve as a “warning sign for the economy.” Summarization of the report below:

  • About three in five consumers with an annual income below $40,000 indicate that their earnings barely or do not cover their expenses, a UBS survey found.
  • Lower-income earners are often renting and carrying non-mortgage debt — such as credit card, auto, and student debt — at levels similar to or higher than the period before the financial crisis.
  • More than one-third of borrowers in this demographic report misrepresenting their financials in loan applications, a UBS survey found.
  • “While delinquency rates among student loans remain the highest of any consumer asset class, several other asset classes are beginning to inflect off of recent lows, despite broadly supportive economic conditions,” UBS said.
  • The new tax law is likely to benefit middle-income borrowers, but it could have limited benefits for lower-income borrowers.
“We believe weakness in these two groups will drive higher credit losses at some stage over the next few years — particularly in credit card, installment, and student loans — with macroeconomic inflection from job growth to job loss as a likely catalyst,” UBS said.​
For now, however, to find the inflection point, keep an eye on the American consumer — rising consumer debt, low personal savings rate, soaring bank funding rates, and wage stagnation could be some of the contributors tilting the economy into the next recession.

http://www.investmentwatchblog.com/ubs-warns-americans-can-no-longer-afford-mobile-homes/0
 

TAEZZAR

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#4
Is this part of lowering home loan requirements to a FICA score of 500 ?
 

Irons

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This may be the long term unemployed that bush and hussein moved directly to welfare.
They are getting their free shit slowly pinched but they don't want to get off the couch.

Well, they have to get off the couch as more jobs come available so there will be a lag in their "wealth."
The sooner they get moving the better for them.


.
 

Merlin

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When I was renting my properties in the Hegewisch neighborhood in Hammond, IN I naively thought I could cherry-pick my renter applications and consider only those with credit score greater than 620. Good luck with that! I was lucky to get applicants in the 500-550 range and remember one that was in the low 400s. Never, ever saw one above 600, :) After struggling with that problem for 6 years, I turned everything over to a property management company to let it be their problem. There are a lot of poor people out there.
 
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GOLDZILLA

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#8
Most of those have a lot rent which makes them even more expensive than buying a stickbuilt home.
 

GOLDBRIX

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#11
God hates mobile homes. Just look what he does to them with hurricanes.
AND
Tornados, In Kentucky trailors are like magnets for tornados.

STORY TIME: Family was taking a trip to Springfield,Missouri. We had driven in a line of heavy rain from Louisville clear through StL.
We scheduled a stop in St. Charles for the night just off the highway that evening. We had no sooner got into our room when a Tornado Siren went off just outside.
My youngest had a phobia about lightening storms. As the siren was going off he ran to the window and pulled open the drape.
" Oh GREAT dad. There is a trailor park right behind this hotel. We're all gonna die!!!"
Fortunately he has grown out of it in the last five years.
 

Merlin

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#12
I gradually learned to look behind the credit score to find the reasons for it being low. If the applicant's low credit rating was caused by a string of medical bills a mile long, I was forgiving.
 

Merlin

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#15

GOLDBRIX

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#17
https://www.tumbleweedhouses.com/tumbleweed-models/cypress/
Starting at.............................61k.
Only a brain dead fool would spend 61k for a shed on a trailer. Anybody that loans money on a fool like that deserves to get clipped
I was 18 miles North of Xenia, Ohio that day. My grandfather owned his last grocery store just on the Clark Co. side on Route 68.
At the store we were getting hail the size of golf balls and tennis balls. My uncle said to the crew "Somebody is getting a tornado. Keep a lookout. A minute or two later a Springfield radio station reported a tornado approaching Xenia from the West according to OHIO Highway Patrolmen.
A co-worker and I jumped into my car ( for some crazy-ass reason) and drove down to Xenia on Rte 68.
Before the tornado coming to Xenia City Limits on Rte 68 was like driving through a tunnel of trees, it was beautiful. NO MORE, Most were shattered.
Greene Co. hospital sat off 68 . There was one house left standing in the neighborhood beyond the hospital parking lot. Beyond that house it looked like a giant lawn mower a half mile wide had come through destroying and leveling hundreds of homes and just missing the hospital. It looked like an apocalyptic war zone. People had not even come out to scope the damage.
In the hospital parking lot there was a brand new Corvette flipped over on its top still teetering front to back
Down trees and powerlines blocked going any further drive into town.
We heard the tornado was still on the ground and figure it could be headed toward the store. We turned around and high-tailed it back to the store.
Store was o.k. but cars were dented up big time.

A day later a newpaper photographer snapped a pic where he found a playing card on edge sliced into a telephone pole.
 

nickndfl

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#18
I think you meant tornadoes...?
I meant hurricanes having survived 5 of them going back to Andrew. They get tossed around like empty beer cans, but when they crash into buildings or bridges they rip wide open and explode. Sometimes the wind just peels them apart.
 

GOLDBRIX

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#19
Both hurricanes and tornadoes are Bad News.
Hurricanes can spawn tornadoes and waterspouts.
Tornadoes can split, combine, and dance with other tornadoes but I never heard of one creating a hurricane.
XENIA was believed to be a main tornado w/ two smaller ones spinning around it at points