LegalShield’s Consumer Stress Index showed that while overall consumer stress remains subdued, the expiration of federal assistance programs, combined with rising rent and housing costs, as well as the chaos created by the Delta variant, have increased the demand for legal services related to employment and tenant issues. This data suggests that some consumers have concern about their financial situations as these federal support systems erode. If this pattern continues, there is a potential for an increase in consumers’ financial stress and a decrease in spending.
“While our data indicated this summer was a strong time for consumers, we feel that there may be some turbulent times ahead, with federal assistance in many areas expiring and added financial pressures on households and businesses around the country,” said Jeff Bell, Chief Executive Officer of LegalShield.
Key takeaways and trend predictions from this index include:
- The Consumer Stress Index worsened (0.5 point) in September, after a quarter of consecutive progress.
- The Bankruptcy Index remains at an all-time low, but could be impacted by the expiration of government protections.
- The Foreclosure Index is also at historically low levels but is expected to increase in the coming months. The surge in home values during the pandemic is likely to soften the blow for many borrowers and help them avoid foreclosure by selling instead.
- The Housing Construction Index reached a new record high in September fueled by strong demand, but homebuilders are struggling to keep up as they battle high material costs, supply chain challenges and a skilled labor shortage.
- The Housing Sales Index reached a new record high in September as consumer concerns persist about affordability. The average monthly payment to buy an average home with a 30-year fixed mortgage increased by 20% in 2021.
