Consumer confidence and home prices jump in the U.S.

U.S. consumer confidence rebounded this month to the highest level in more than nine years, as Americans appeared unfazed by a tumultuous election campaign, reports Paul Wiseman of The Associated Press.

The Conference Board said Tuesday that its consumer confidence index registered 107.1 in November, up from 100.8 last month and highest since July 2007.

Americans’ assessment of current economic conditions was also the sunniest since July 2007. Their expectations for the next six months were the most optimistic since June 2015.

Read: U.S. advisors not shaken by election results: survey

The survey was mostly taken before the November 8^th election. Still, Conference Board economist Lynn Franco says that “it appears from the small sample of post-election responses that consumers’ optimism was not impacted by the outcome.”

The index had fallen in October and was expected to rise this month, but the strength of the rebound took economists by surprise.

“The election result has had a clear positive impact on sentiment,” Andrew Hunter, U.S. economist at Capital Economics, wrote in a research note. “It also supports our view that consumer spending will continue to rise at a decent pace over the rest of the year.”

Economists monitor the mood of consumers because their spending drives growth, accounting for almost 70% of U.S. economic output.

The U.S. economy looks healthy. The government reported Tuesday that the economy grew at a 3.2% annual pace from July to September—the fastest pace in two years. Consumer spending advanced at a 2.8% annual pace in the third quarter, better than a previous estimate of 2.1%.

The unemployment rate is 4.9%, close to what economists consider full employment. Employers have added an average 181,000 jobs a month so far this year, down from 229,000 a month in 2015 but still solid.

U.S. home prices recover

It was also revealed today that U.S. home prices have fully recovered from their steep plunge during the housing bust and Great Recession, according to a private measure.

As Christopher S. Rugaber of The Associated Press reports, the Standard & Poor’s CoreLogic Case-Shiller national home price index, released Tuesday, is slightly above the peak it set in July 2006, after rising 5.5% in September from a year earlier. The milestone comes after more than four years of steady gains.

Read: Should clients invest in U.S. real estate?

Still, prices have not fully recovered in many cities and other gauges show that home prices remain below their peaks.

Steady job gains and low mortgage rates have encouraged more Americans to buy homes. Yet the supply of available properties has dwindled, setting off bidding wars and pushing up prices at a rapid pace.

Seattle, Portland and Denver reported the largest annual gains in September for the eighth straight month.

“The new peak set by the S&P Case-Shiller CoreLogic national index will be seen as marking a shift from the housing recovery to the hoped-for start of a new advance,” said David Blitzer, managing director at S&P Dow Jones Indices.

The ongoing recovery in home prices shores up Americans’ household wealth and should provide more homeowners the incentive to sell. The number of homes for sale is low partly because many families have little equity in their homes and would benefit little from a sale. Rising home values help counter that trend.

Yet many cities remain far below their pre-recession peaks, Blitzer said, including those that have seen large gains since the downturn, such as Miami, Tampa, Phoenix, and Las Vegas.

Other analysts caution that imbalances remain in the housing market.

“Inadequate supply of homes available to buy—especially at the entry-level end of the market— remains a huge problem,” Svenja Gudell, chief economist for real estate data provider Zillow, said.

After adjusting for inflation, prices remain about 20% below their peak, according to Ralph McLaughlin, chief economist at Trulia, a home buying website.

“It’s good news for homeowners,” McLaughlin says, “but not so great news for homebuyers who have seen prices outpace incomes for most of the housing market recovery.”

Since the real estate market began recovering in 2012, prices have grown much faster than Americans’ incomes. That has made it difficult for many would-be buyers, particularly younger Americans, to take advantage of low mortgage rates.

Home prices have increased at a 5.9% annual rate, adjusted for inflation, S&P says. Yet Americans’ after-tax incomes have increased just 1.3% during that time.

Jonathan Smoke, chief economist for Realtor.com, said that many buyers who were unable to find homes during the summer buying season continued searching in the fall, pushing up demand at a time when it typically drops off.

“This was a very strong off-season compared to normal,” he said.

Mortgage rates have risen about a half-percentage point since the presidential election, to nearly 4%. That is still very low by historical standards, but could slow home sales in the coming months.

According to the S&P Case Shiller national home price index, home prices plummeted 27.4% from a peak reached in July 2006 through February 2012. They have since recovered that loss and are now 0.1% above the previous peak.

S&P Case-Shiller issues several home price measures, including a composite index of 20 large cities. That measure remains 7% below its housing bubble peak.

Most other measures of the housing market point to a solid recovery. Sales of existing homes rose to the fastest pace in nearly a decade in October. And, last month, developers broke ground on the highest amount of new homes in nine years.

Sales of new homes slowed in October from the previous month, but are up a solid 12.7% in the first 10 months of this year compared to the same period in 2015.