8 Feb 2021

It’s Just The Facts: January 2021

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  1. I OWE ABSOLUTELY NOTHING! – 37% of US homeowners do not have any outstanding debt on their primary residence, including no mortgage debt or any debt associated with a home equity loan (source: American Community Survey).
  2. HOW CHEAP? – At the beginning of 2020, the all-time record low average interest rate nationwide for a 30-year fixed rate mortgage was 3.31% set on 11/22/12.  A new record low average rate was established during 16 separate weeks in 2020, the last taking place on 12/24/20 at 2.66% (source: Freddie Mac).
  3. GOING MY WAY? – The 3 most popular states to move into during 2020 were Tennessee, Texas and Florida.  The 3 states with the greatest outflow of people during 2020 were California, Illinois and New Jersey.  The rankings are based upon more than 2 million rentals of moving trucks last year that involved a “1-way” interstate movement of furnishings, personal possessions and clothing (source: U-Haul Migration Trends 2020).
  4. NOW WHAT DO I DO? – 82% of 2020 college graduates did not have a full-time job in place on the day they graduated last year (source: TotalJobs Group Ltd.).
  5. RED AND BLUE PROBLEM – The national debt increased +86% during George W. Bush’s 8 years as president, reaching $10.63 trillion as of 1/20/09.  The national debt increased +88% during Barack Obama’s 8 years as president, reaching $19.95 trillion as of 1/20/17.  And finally, the national debt increased +39% during Donald Trump’s 4 years in the White House, reaching $27.75 trillion as of 1/20/21 (source: Treasury Department).
  6.  IS IT A BUBBLE? – The US stock market was worth $42.6 trillion as of the close of trading on 1/22/21, 2.0 times the size of our $21.2 trillion economy.  At the peak of the dot-com stock bubble in March 2000, the US stock market was worth 1.4 times the size of the US economy (source: Fund Manager Julien Bittel).
  7. REALLY LOW – Inflation, as measured by the “Consumer Price Index” (CPI), was up +1.4% for 2020.  For the decade of the 2010s (1/01/2010 through 12/31/2019), inflation was up just +1.8% per year, the lowest decade of inflation in the USA since the 1930s.  By comparison, the decade of the 1970s (1/01/1970 through 12/31/1979) suffered +7.4% annual inflation (source: Department of Labor).
  8. THEY OWN IT NOW – Banks foreclosed on 50,238 homes nationwide in 2020, down 65% from 143,955 foreclosures in 2019 and down 78% from 230,305 foreclosures in 2018.  The worst single year of foreclosures in US history – 1,050,500 foreclosures in calendar year 2010 (source: ATTOM Data Solutions).
  9. ESTATE TAXES – The maximum amount that a deceased individual may pass onto his/her heirs federally estate-tax free (with proper planning) rises to $11.7 million in 2021, up from $11.58 million in 2020.  The limit was $675,000 in 2001 or 20 years ago.  Please consult a tax expert for details (source: Internal Revenue Service).
  10. WHERE DOES THIS MONEY COME FROM? – The Fed is buying $120 billion of bonds each month – $80 billion of Treasury debt and $40 billion of mortgage-backed securities.  The Fed confirmed on 12/16/20 that the purchases will continue “until substantial further progress has been made toward the Committee’s maximum employment and price stability goals” (source: Federal Reserve).
  11. DEBT – The USA increased its national debt by $7.77 trillion in the last 4 years, i.e., 2017-20.  The USA increased its national debt by $7.67 trillion in the previous 7 years, i.e., 2010-16 (source: Treasury Department).
  12. GOT A LOWER RATE – Through 9/30/20, 65% of the mortgages that were originated in the United States YTD were refis of existing mortgages (source: Inside Mortgage Finance).
  13. IN MY PAJAMAS, BUT STILL WORKING – 67% of 451 information technology (IT) executives in the United States that were polled in June 2020 anticipate that their firm’s “work-from-home” (WFH) policies would be permanent or at the very least “long-term” in duration (source: 451 Research).
  14. JOBLESS – The lowest (3.5%) and the highest (14.7%) unemployment rates in the United States in the last 50 years (since 1970) both occurred in 2020, and they took place just 2 months apart (source: Department of Labor).
  15. LIVING LONG – The life expectancy at birth of an American baby in 1971, i.e., 50 years ago, was 71.1 years.  The life expectancy at birth of an American baby today is 78.7 years.  Thus, life expectancy in the United States has increased 7.6 years over the last half century, i.e., American life expectancy at birth is increasing at the rate of 1.5 years every decade (source: Center for Disease Control).
  16. HOUSING – The average interest rate nationwide on a 30-year fixed rate mortgage was 2.76% at the end of 2020.  The all-time record low national average is 2.66%, set just 1 week earlier on 12/24/20 (source: Freddie Mac).

Courtesy of Mortgage Market Guide 

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