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11 BANKRUPTCIES UP NEARLY 20% YOY According to bankruptcy filing data from Epiq Bankruptcy, bankruptcies of all types are up year over year in January of 2023. By the numbers, the total amount of filings in January clocked in at 31,087 which is up 19% from the 26,215 reported in January 2022. Of that number, 29,545 were individual filings, a number which is also up 20% on a yearly basis. Still below pre-pandemic numbers, individ- ual Chapter 13 filings continued to increase in January as the 13,702 reported filings were a 32% increase over the January 2022 total of 10,346. Also, according to Epiq, total commercial fil- ings increased 12% to 1,694 in January 2023 over the 1,508 total filings reported in January 2022. Commercial Chapter 11 filings increased 70% to 257 filings up from 151 filings recorded one year ago. All subchapter five small business filings increased 49% to 137 in January 2023 from the 92 filings registered the previous year. Epiq also said that compared to December 2022, every Chapter's new filings except Chapter 12 increased. January's total filings represented a 5% increase when compared to the 29,640 total filings recorded in December. Total individual filings for January represented a 6% increase from the Decem- ber 27,911 total; however, total commercial filings did decrease 2% from 1,729 in December. Individual Chapter 7 increased 2% from 15,471 and individual Chapter 13 increased 10% over December's 12,393. Total Chapter 11 filings registered a 16% increase from the 365 filings reported the previous month, and total Chapter 11 subchapter 5 by themselves increased 9% from the 126 filed in December 2022. "While still below pre-pandemic totals, bankruptcy filings continue to increase amid growing debt loads due to inflationary pressures and reduced availability of low-cost financing," ABI Executive Director Amy Quackenboss said. "Struggling households and businesses on shaky economic footing can look to bankruptcy to pro- vide a solid path toward a financial fresh start." AFFORDABILITY REMAINS CHIEF CONSUMER CONCERN e Home Purchase Sentiment Index (HPSI) published by Fannie Mae increased for its third straight month in January 2023, rising 0.6 points to an index of 61.6 points as three of the index's six components increased month over month. Of the six questions asked to consumers, only 17% of survey respondents believe it's a good time to buy, likely owing to the relatively high home prices and still-increasing nominal interest rates. Year-over-year, the index is down by 10.2 points. "January's HPSI results showed that consumer sentiment toward the housing market remains subdued by historical standards," said Doug Duncan, Fannie Mae's SVP and Chief Economist. "For consumers, the same affordabil- ity issues are persisting, as they continue to indi- cate that high home prices and high mortgage rates make it a 'bad time to buy' a home." "e latest survey data also indicated that the majority of consumers expect home prices to decrease or remain flat over the next year, which may incentivize some potential homebuyers to delay their purchase decision," Duncan continued. "Although 'good time to sell' sentiment ticked upward this month, it's still much lower than it was a year ago, as purchase affordability remains seriously constrained and mortgage demand has receded. Until we see improvements in affordability via lower home prices and mortgage rates, we expect home sales to remain muted in the coming months." As highlighted by Fannie Mae, the indexes components showed: Good/bad time to buy: e percentage of respondents who say it is a good time to buy a home decreased from 21% to 17%, while the percentage who say it is a bad time to buy in- creased from 76% to 82%. As a result, the net share of those who say it is a good time to buy decreased 9 percentage points month over month. • Good/bad time to sell: e percentage of respondents who say it is a good time to sell a home increased from 51% to 59%, while the percentage who say it's a bad time to sell decreased from 42% to 39%. As a result, the net share of those who say it is a good time to sell increased 11 percentage points month over month. • Home price expectations: e percentage of respondents who say home prices will go up in the next 12 months increased from 30% to 32%, while the percentage who say home prices will go down remained unchanged at 37%. e share who thinks home prices will stay the same increased from 29% to 30%. As a result, the net share of those who say home prices will go up increased 2 percentage points month over month. • Mortgage rate expectations: e percentage of respondents who say mortgage rates will go down in the next 12 months decreased from 14% to 13%, while the percentage who expect mortgage rates to go up increased from 51% to 52%. e share who thinks mortgage rates will stay the same remained increased from 31% to 33%. As a result, the net share of those who say mortgage rates will go down over the next 12 months decreased 2 percentage points month over month. • Job loss concern: e percentage of respondents who say they are not concerned about losing their job in the next 12 months remained unchanged at 82%, while the per- centage who say they are concerned increased from 17% to 18%. As a result, the net share of those who say they are not concerned about losing their job remained unchanged month over month. Note: Net share number remained unchanged due to rounding. • Household income: e percentage of respondents who say their household income is significantly higher than it was 12 months ago decreased from 25% to 22%, while the percentage who say their household income is significantly lower decreased from 15% to 10%. e percentage who say their house- hold income is about the same increased from 59% to 67%. As a result, the net share of those who say their household income is significantly higher than it was 12 months ago increased 2 percentage points month over month. Journal