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Economic Update for the Week Ending July 31st, 2021

Stocks – Stock markets closed just off last week’s all-time highs. Despite an annualized 6.5% rise in GDP in the second quarter and strong corporate profits, surging COVID cases worried investors. The Dow Jones Industrial Average closed the week at 34,935.47, down 0.4%  from 35,061.55 last week. It is up 14.1% year-to-date.  The S&P 500 closed the week at 4,395.26, down 0.4% from 4,411.79 last week. It is up 17.1% year-to-date. The NASDAQ closed the week at 14,672.68, down 1.1% from 14,836.99 last week. It is up 13.9% year-to-date.

Stock Market Graphics

U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 1.24%, down from 1.30% last week. The 30-year treasury bond yield ended the week at 1.89%, down from 1.92% last week. We watch bond yields because mortgage rates often follow treasury bond yields.

Mortgage rates – The July 29, 2021, Freddie Mac Primary Mortgage Survey reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate was 2.80%, almost unchanged from 2.78% last week. The 15-year fixed was 2.10%, down from 2.17% last week. The 5-year ARM was 2.45%, down slightly from 2.49% last week.

Economic update for the month ending July 31, 2021

Stock markets –  The Dow Jones Industrial Average closed the month at 34,935.47 up 1.3% from 34,502.52 at the end of June. It is up 14.1% year-to-date. The S&P 500 closed the month  at 4,395.26 up 2.3% from 4,297.50 last month. It is up 17.1% year-to-date. The NASDAQ closed the month at 14,672.68 up 1.2% from 14,503.74 last month It is up 13.9% year-to-date.

U.S. Treasury bond yields – The 10-year treasury bond closed the month yielding 1.24%, down from 1.45% last month. The 30-year treasury bond yield ended the month at 1.89%, down  from 2.26% last month. We watch bond yields because mortgage rates often follow treasury bond yields.

Mortgage rates – The July 29, 2021, Freddie Mac Primary Mortgage Survey reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate was 2.80%, down from 2.98% last month. The 15-year fixed was 2.10%, down from 2.26%  last month. The 5-year ARM was 2.45%, down from 2.54% last month.

The July jobs report will be released on Friday. Home sales are released on the third week of the month for the previous month. These are June’s results. 

U.S. employers added 850,000 jobs in June – The Department of Labor and Statics reported that 850,000 new jobs were added in June. That was a much higher than the 559,000 new jobs added in May, and the most jobs added in 10 months. The unemployment rate was 5.9% in June, up from 5.8% in May, as more workers entered the workforce.

June U.S. home sales – The National Association of Realtors reported that existing-home sales jumped 22.9% from the number of homes sold last June. The median price paid for a home in May was $363,300, up 23.4% from last June’s median price of $294,400. May marked the 112th  straight months of year-over-year increases in the median price. The unsold inventory level is at a 2.6-month supply, down from a 3.9-month supply one year ago. Total housing inventory was 3.3% higher in June than the number of homes for sale in May, but down 18.8% from the number of homes for sale one year ago. First time buyers accounted for 31% of all purchases. Second-home and investor purchases accounted for 17% of all homes sold. Foreclosures and short sales accounted for less than 1% of all homes sold. All cash purchases accounted for 23% of all transactions.

California home prices continue to rise at record pace in June – The California Association of Realtors reported that existing home sales totaled 436,000 on a seasonally adjusted annualized rate in June. That marked a 28% year-over-year increase in the number of sales. The median price paid for an existing home in June was $819,630, up from May’s $818,260 median price. Year-over-year the median price increased 30.9% from last June when the median price was $588,070June marked a third straight month of year-over-year gains of over 30% in the median price.  The California Association of Realtors tracks inventory levels based on how many months it would take to sell the active listings in all MLS systems at the current sales level. There was a 1.7 month supply of homes for sale in June, down from a 2.7 month supply of homes for sale last June. Active listings are beginning to climb, and are at the highest level since last October.

Below are median price and sales data by county.

Sources:

  1.  Rodeo Realty, Inc.
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