Household income posted its first significant increase in eight years, new data from the U.S. Census Bureau showed, according to an article by Mike Snider in USA Today.
U.S. median household income rose 5.2% in 2015 to $56,516, but income remains below the 2007 average, the article said.
From the article:
Still, the household income grew at the fastest rate on record, said Council of Economic Advisers Chairman Jason Furman in a blog post on the White House website. The report, he said, "shows the remarkable progress that American families have made as the recovery continues to strengthen. ... Income grew for households across the income distribution, with the fastest growth among lower- and middle-income households."
He also noted that the poverty rate fell faster than at any point since 1968, and the rate of those without health insurance also declined. The official poverty rate fell 13.5% with 43.1 million in poverty, 3.5 million less than in 2014, the bureau said.
This shows the economy is not dependent on interest rates anymore, according to Redfin Chief Economist Nela Richardson.
“Today's report suggests that the run up in home prices and sales growth has legs and will persist into 2017. Income growth is a fundamental driver of buyer demand," Richardson said.
“Up until 2015, the housing recovery occurred without any upward movement in median household incomes,” Richardson added.
“Today's news tells us the rebound in housing is not dependent on rates anymore, and that's a strong signal of the persistence of the housing recovery," Richardson concluded. “The fact that the gains were widespread is also good for housing, but the lack of income growth outside of metro areas raises concerns about the splintering of the housing market between fast-growing urban areas and everywhere else."