WASHINGTON: US household net worth hit a record high in the third quarter as home prices marched higher and the value of stocks and mutual funds surged, boosting the economic outlook.
The Federal Reserve said on Monday net worth increased $1.9 trillion to $77.3 trillion in the third quarter, the highest level since records started in 1945.
The value of residential real estate rose by $428 billion between July and September, and corporate equities and mutual funds were up by $917 billion over the period, it said.
The US central bank has aggressively used ultra-easy monetary policy to foster a recovery in the nation's housing market following a severe 2007-2009 recession, which has also helped propel US stocks to record highs.
Increases in housing wealth make it easier for families to borrow against the equity in their homes, while overall wealth gains make consumers feel generally more comfortable spending their money. Many economists think consumers spend a few cents of every dollar they gain in wealth.
Household debt, in a possible sign that deleveraging has come to a halt, was up by an annualized 3.0 percent in the third quarter, to $13.1 trillion. That number has stabilized over the last several quarters.
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