Economic update for the week ending December 24, 2016

Stocks continued to climb this week – The DOW Jones Industrial Average closed the week at 19,933.81, up from last week’s close of 19,843.41. The S&P 500 ended the week at 2,263.79, up from its close of 2,258.07 last week. The NASDAQ closed the week at 5,462.69, up from last week’s close of 5,437.16.

U.S. Treasury Bond yields – The 10-year U.S. Treasury Bond closed the week yielding 2.55%, down from 2.60% last Friday. The 30-year Treasury Bond yield closed the week at 3.12%, down up 3.19% last week. Mortgage rates follow bond yields, so we watch treasury bonds closely.  

Mortgage rates continue to rise – The Freddie Mac Primary Mortgage Survey released on December 22, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 4.30% The 15-year fixed average rate was 3.52%. The 5/1 ARM average rate was 3.32%. Rates are now about 3/4% higher than before the election 6 weeks ago. 

California adds 31,200 jobs in October- The California Employment Development Department reported that California employers added 31,200 net new jobs in October. The unemployment rate held steady at 5.5%. Los Angeles County added 38,900 jobs and the unemployment rate was 5.1%. in October. 

California home sales and prices higher than last November – The California Association of Realtors announced that November home sales totaled 442,320 homes on a seasonally adjusted annualized rate. That was up just 0.1% from October, yet up 17.7% from last November when new closing disclosure delayed closings. The unsold inventory index dropped again to a 3.1 month supply of homes on the market. That’s an all time low and down from a 4.2 month supply last November. November’s statewide median price was $501,710, up 4.9% from November 2015 when the median price was $478,140. 

Nationwide home sales highest since February 2007 – November existing home sales rose 0.7% from October’s level and were 15.4% higher than last November, according to The National Association of Realtors. The median price for an existing home in The U.S. was 6.8% higher than November 2015. That marked the 57th consecutive month with a year over year price gain. 

I wish you all a Merry Christmas, Happy Hanukkah, or any other holiday you are celebrating!