Household Debt Rises to New Record-High
November 10, 2021
Household debt in the U.S. topped $15 trillion for the first time during the third quarter, according to the New York Federal Reserve. Total debt increased 1.9%, or $286 billion, from the second quarter, bringing the total to $15.24 trillion. That is a 6.2% increase from the same period last year.
The Fed’s report covers the period from July to September, when economic growth in the U.S. slowed to an annualized pace of 2% amid supply-chain disruptions and the spread of the Delta variant.
The increase was driven primarily by climbing home and car prices. Mortgage balances, which account for the bulk of household debt, were up 2.2% to a total of $10.7 trillion. The median home price climbed by nearly 20% during the quarter, according to data from the Census Bureau. Auto loans also increased by $28 billion.
Credit card debt was up slightly, bucking a pandemic-era trend that saw Americans paying down their credit card balances. Credit card debt increased by $17 billion to roughly $800 billion.
Fed officials noted that, even as household debt continues to grow, the number of serious delinquencies has remained very low and continues to decline, due in large part to government stimulus and a high personal savings rate.