Economic Update For The Month Ending November 30, 2020

Stock markets soared in November – Investor’s drove stock market indexes to record highs in November. The rally was fueled by positive news from several vaccine trials revealing that some of the vaccines were 90-95% effective. The FDA indicated that an emergency approval of at least two vaccines would allow people to start to be vaccinated in the coming weeks. This drove stocks even higher. The Dow Jones Industrial Average closed the month at 29,638.64, up 11.8% from 26,501.60 last month. The S&P 500 closed the month at 3,621.63, up 10.8% from 3,269.96 last month. The NASDAQ closed the month at 12,198.74, up 11.8% from 10,911.59 last month.

U.S. Treasury bond yields – The 10-year treasury bond closed the month yielding 0.84%, down from 0.88%, last month. The 30-year treasury bond yield ended the month at 1.58%, down from 1.65% last month.

Mortgage rates – The Freddie Mac Primary Mortgage Survey released on November 25, 2020 reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate average was 2.72%, down from 2.81% last month. The 15-year fixed was 2.28%, down from 2.32% last month. The 5-year ARM was 3.18%, up from 2.88% last month.

October Job gains beat expectations -The Department of Labor Statistics reported that the U.S. economy added 638,000 new jobs in October. The unemployment rate dropped to 6.9% in October from 7.9% in September. These numbers beat analysts’ expectations of 530,000 new jobs and an unemployment rate of 7.7%. It should also be noted that private employers added 906,000 jobs, but 268,000 government jobs were lost in October. That included 147,000 census workers that were hired to complete the census count, which is now concluded. November figures will be released Friday.

Home sale data is released on the third week of each month for the following month. Below are October’s results.

Existing-home sales and prices continue to soar in October – The California Association of Realtors reported that existing, single-family home sales totaled 484,510 on an annualized basis in October. That represented a year over year increase of 19.5% from the number of homes sold in October 2019. The median price paid for a home in California was $711,300, up 17.5% from the median price last October. Inventory levels were lower than one year ago. There was just a two-month supply of homes for sale in October. That is unchanged from September, as new listings also increased to meet demand. One year ago, the unsold inventory index stood at a 3-month supply. Below please find regional statistics for Southern California.

U.S. Existing-home sales climb in October – The National Association of Realtors reported that existing home sales in October rose 4.3% month-over-month from September and rose 26.6% year-over-year from the number of homes sold in October 2019. The median price paid for a home increased 15.5% from one year ago. That marked the 104th straight month of year-over-year increases in the median price. The inventory level in the United States was 1.42 million homes, a 2.5-month supply. That’s a record low. There was a 2.7-month supply last month and a 3.9-month supply in October 2019.