Stock markets dropped as COVID-19 related job losses surge – Stock markets fell off their all-time highs last week as investors feared that the economic business closures may last longer than expected due to what appears to be an out of control spread of COVID-19, and a vaccination process that has failed to live up to the numbers expected. Stocks were hit even harder on Thursday after it was reported that initial unemployment claims rose sharply last week. They were over 1 million for the first time since July. The Dow Jones Industrial Average closed the week at 30,814.26, down 0.9% from 31,097.97 last week. It is up 0.7% year-to-date. The S&P 500 closed the week at 3,768.25, down 1.5% from 3,824.68 last week. It is up 0.3% year-to-date. The NASDAQ closed the week at 12,998.50, down 1.5% from 13,201.98 last week. It is up 0.9% year-to-date. U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 1.11%, almost unchanged from 1.13% last week . The 30-year treasury bond yield ended the week at 1.85%, almost unchanged from 1.87% last week. We watch bond yields because mortgage rates often follow treasury bond yields. Mortgage rates – The January 14, 2021 Freddie Mac Primary Mortgage Survey reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate was 2.79%, up from 2.65% last week. The 15-year fixed was 2.23%, up from 2.16% last week. The 5-year ARM was 3.12%, up from 2.75% last week. Unfortunately, rates increased late in the week. Next week’s mortgage rates will be higher. California existing home sales – The California Association of Realtors reported that existing, single-family home sales totaled 509,750 on an annualized basis in December. That represented a year-over-year increase of 28% from the 398,370 annualized rate of homes sold in December 2019. It was the highest number of monthly home sales in 15 years, and the most homes ever sold in December. Home sales are homes that closed escrow. Pending home sales are new contracts signed. Those are at near-record levels as well. For the entire year of 411,870 homes sold, up 3.5% from 397,960 homes sold in 2019. That number is pretty incredible considering home sales were down almost 30% at the end of June. There was a record number of sales in the second half of the year. The median price paid for a home in California was $717,930, up 16.8% from the median price of $659,380 last December. Inventory levels were lower than one year ago. There was just a 1.3-month supply of homes for sale in December, down from a 2.5-month supply one year ago. The current supply of homes was almost unchanged from September and October, as a record number of new listings were taken in November but sold quickly. Below please find a graph of regional statistics for Southern California.