Genworth Financial issued the following announcement on June 25.

Genworth Mortgage Insurance, an operating segment of Genworth Financial, Inc. (NYSE: GNW), today released takeaways from the first quarter of 2020 by its Chief Economist, Tian Liu. Additional details and charts can be accessed here.

COVID-19 Impact:

The first-time homebuyer market faced significant dislocation in April as a result of COVID-19. The number of rate locks by potential first-time homebuyers decreased by 27% in April from March as the spread of COVID-19 reduced traffic by potential homebuyers and listings.

States heavily impacted by COVID-19, including New York, Pennsylvania, and Michigan saw decreases of over 50% in April.

The dislocation was even greater for the repeat buyers' market. The repeat buyers' market fell by 34%, in part because repeat buyers faced greater hurdles in selling their existing homes.

The COVID-19 pandemic has resulted in tighter credit availability in the housing market, that led to a sharp contraction in first-time homebuyers with riskier credit profiles or relying on mortgages not backed by Fannie Mae and Freddie Mac.

The number of first-time homebuyers taking out FHA loans decreased by 36% in April, and the market for jumbo loans decreased by 50%.

The number of first-time homebuyers using other products have seen smaller declines in April. For example, the number of first-time homebuyers using mortgage insurance decreased only by 18% in April, and those using VA loans decreased by 23%.

As the economy re-opened in May, the first-time homebuyer market rebounded by 27%. The repeat buyers' market rebounded by 37% in May as existing homeowners came back to the market.

The number of first-time homebuyers rebounded across all mortgage products, with jumbo loan borrowers up 41%, FHA loan borrowers up 29% and low down payment conventional loan borrowers up 24%.

"The COVID-19 pandemic pushed the U.S. economy into the sharpest recession on record in March," said Tian Liu, chief economist at Genworth Mortgage Insurance. "The housing market corrected in April, with first-time homebuyer activities down almost 30% in just one month. However, what followed was a quick rebound in May of almost the same magnitude. This is not what we typically see in a normal recession."

The summary of the data and Tian Liu's analysis can be accessed, here.

About Genworth Mortgage Insurance

Genworth Mortgage Insurance, an operating segment of Genworth Financial, Inc. (NYSE: GNW), is headquartered in Raleigh, North Carolina, and operates in all 50 states and the District of Columbia. Genworth Mortgage Insurance works with lenders and other partners to help people responsibly achieve and maintain the dream of homeownership by ensuring the broad availability of affordable low down payment mortgage loans. Genworth has been providing mortgage insurance products and services in the U.S. since 1981.

Disclaimer

Opinions, analyses, estimates, forecasts, and other views included in these materials are those of Tian Liu, are based on current market conditions and are subject to change without notice, do not necessarily represent the views of Genworth or its management, and should not be construed as indicating Genworth's business prospects or expected results. Neither Tian Liu nor Genworth guarantees that the information provided in these materials is accurate, current, or suitable for any particular purpose. Forward looking statements should not be considered as guarantees or predictions of future events.

SOURCE Genworth Mortgage Insurance

For further information: For media inquiries, please contact: Brittany Harris-Flowers, Genworth Mortgage Insurance, 803 290.1855 (c), Brittany.Harris-Flowers@genworth.com

Original source: https://newsroom.genworth.com/2020-06-25-Genworth-Mortgage-Insurances-Economist-Takeaways-First-Quarter-2020-How-COVID-19-Impacted-First-Time-Homebuyers