Total Credit Outstanding Declines as Interest Rates Climb


By David Logan on October 10, 2023 • According to the Federal Reserve’s latest G.19 Consumer Credit report, total consumer credit outstanding totaled $4.97 trillion (seasonally adjusted annual rate) in August, a decrease of $15.6 billion over the month but $188.8 billion—or 3.9%–higher than August 2022. The monthly decline resulted from a 0.8% drop in nonrevolving credit outstanding that was partially offset by a 1.2% increase in revolving credit. The level of revolving debt—primarily credit card debt—rose $14.7 billion over the month and $122.9 billion over the year (SAAR). Revolving debt outstanding has increased two consecutive months by a total of $24.3 billion (SAAR)—or 1.9%. Revolving and nonrevolving debt accounted for 25.9% and 74.1% of total consumer debt, respectively.  Since reaching a 32-year low in April 2021, revolving consumer credit outstanding as a share of the total has increased to a level not seen since July 2019. Credit card interest rates have climbed 61 basis points since May, reaching a record-high of 22.77% in August.  The average credit card interest rate has increased 434 basis points–or 23.6%–over the past 12 months. Interest rates for 60-month auto loans issued by commercial banks edged up seven basis points—from 7.81% to 7.88%–in August. Auto loan rates have surged 336 basis points, or 74.3%, since early 2022. Related ‹ Residential Building Wage Growth SlowingTags: credit card debt, household balance sheets, interest rates, nonrevolving credit, nonrevolving debt, revolving credit, revolving debt

Total Credit Outstanding Declines as Interest Rates Climb2023-10-10T14:17:36-05:00

Household Real Estate Value Jumps in the Second Quarter


By Jesse Wade on September 12, 2023 • The second quarter of 2023 release of the Z.1 Financial Accounts of the United States indicates that the market value of households’ real estate assets increased over the quarter. Low existing for-sale inventory helped to increase real estate value after falling for three consecutive quarters. The level of households’ real estate assets increased by $2.43 trillion from $42.07 trillion in the first quarter of 2023 to $44.50 trillion in the second quarter of 2023, a 5.78% increase. This was the first quarter-over-quarter increase since the second quarter of 2022. The market value of owner-occupied real estate decreased 0.14% on a year-over-year basis from $44.56 trillion a year ago. This marked two consecutive quarters of year-over-year declines in the market value of real estate assets, the first occurrence since the second quarter of 2012. Real estate secured liabilities of households’ balance sheets, i.e., mortgages, home equity loans, and HELOCs, increased over the second quarter from $12.76 trillion to $12.85 trillion, a 0.71% quarterly increase. Year-over-year, real estate liabilities have increased 4.14% from $12.34 trillion in the second quarter of 2022. The year-over-year growth of real estate liabilities has fallen from 9.96% in the first quarter of 2022 but remains positive. Aggregate owners’ equity (i.e., the difference between homeowners’ real estate assets and liabilities) rose from $29.31 trillion to $31.65 trillion, representing 71.12% of all owner-occupied household real estate. Related ‹ Geography of Homeownership and Home BuildingTags: home equity, homeowner equity, household balance sheets, household debt, market value, mortgage debt, residential real estate

Household Real Estate Value Jumps in the Second Quarter2023-09-12T11:31:31-05:00

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