Credit Sesame’s personal finance news roundup December 30, 2023. Stories, news, politics and events impacting personal finance during the past week.
- New home sales drop to lowest level of 2023
- Holiday sales growth appears to have been sluggish
- Latest figures show job markets vary widely from state to state
- Mortgage rates continue downward trend
- Pending home sales remain at record lows
- U.S. home prices reached new highs in October
- Dollar slides in response to falling interest rates
- Stocks end 2023 on a roll
1. New home sales drop to lowest level of 2023
In November, sales of newly constructed homes fell to their lowest level of 2023. Sales dropped by 12.2% during the month, down to a seasonally adjusted annual pace of 590,000 units. Monthly sales rose in the Northeast and Midwest but fell in the South and West. One optimistic note for would-be home buyers is that the average price of a new home fell in November. The average home sales price during the month was $434,700, a 6% decline from a year earlier. See article at Yahoo.com.
2. Holiday sales growth appears to have been sluggish
An early estimate of consumer spending during the 2023 holiday shopping season showed an increase of just 3.1% over the past year. That estimate, from the Mastercard SpendingPulse report, exactly matches the inflation rate over the same period. That means Americans bought pretty much the same amount as they did a year earlier after accounting for higher prices. Online sales growth outpaced in-person sales growth. Online holiday spending from November 1 through December 24 was up 6.3%, compared to just 2.2% for in-store shopping. However, in-store shopping still represents a much bigger portion of overall retail spending. See article at Yahoo.com.
3. Latest figures show job markets vary widely from state to state
While the national unemployment rate remains low at 3.7%, conditions are significantly worse in some states than others. On the positive side of the ledger, Maryland had the lowest jobless rate in the nation as of November, at 1.8%. North Dakota wasn’t far behind, at 1.9%. At the other extreme, Nevada had the nation’s highest unemployment rate, 5.4%. Over the past year, New Jersey had the worst increase in unemployment. Its unemployment rate jumped by 1.4% to 4.7%. Maryland achieved the nation’s lowest jobless rate by showing the biggest percentage decrease in unemployment over the past year. Its unemployment rate fell by 1.3% over the past twelve months. See report at BLS.gov.
4. Mortgage rates continue downward trend
30-year mortgage rates declined for the ninth week in a row. Rates fell by 0.06% last week to 6.61%. In all, rates have fallen by 1.18% over the past two months. 30-year rates are at their lowest level since the end of May but are still 0.19% higher than when the year began. Evidence that inflation eased in October and November has been the key to the recent decline in mortgage rates. See latest mortgage rate data at FreddieMac.com.
5. Pending home sales remain at record lows
Despite a sustained drop in mortgage rates, pending home sales volume was unchanged in November 2023. This leaves pending home sales at the lowest level since the National Association of Realtors began tracking them in 2001. The lack of improvement was a disappointment compared to the 0.9% increase in sales expected by economists. Pending home sales declined over the past year in all four regions of the United States and are down by 5.2%. See article at Yahoo.com.
6. U.S. home prices reached new highs in October
Despite sluggish sales volume, the latest figures on home prices show that they reached a record high in October 2023. After seasonal adjustment, the S&P CoreLogic Case-Shiller National Home Price Index was up 0.6% in October. That was the ninth consecutive monthly increase for home prices. Over the past 12 months, national home prices have risen by 4.8%. Detroit had the fastest annual price growth rate, at 8.1%. San Diego and New York City followed, with annual gains of 7.2% and 7.1%, respectively. See report at SPGlobal.com.
7. Dollar slides in response to falling interest rates
The U.S. dollar entered the last trading day of the year, down by about 3% in 2023. Though mild, that decline would mark the worst performance for the dollar against international currencies since 2020. The dollar’s weakness is a function of widely-anticipated interest rate cuts in 2024. Among other things, currencies respond to the interest rates investors expect to be able to earn in that currency. See article at Yahoo.com.
8. Stocks end 2023 on a roll
Bouncing back from a poor 2022, stocks entered the final day of trading in 2023 amid a strong rally. The S&P 500 was on track for its ninth straight week of gains. If it achieves that, it would be the S&P’s longest winning streak since 2004. The tech-heavy Nasdaq index was up by more than 40% for the year. See article at Yahoo.com.