(Bloomberg.com) — The U.S. household net wealth jumped to an all-time high in the fourth quarter due to higher stock prices and greater home values.

A Federal Reserve report on Thursday showed that the net worth of households increased by $5.3 trillion or 3.7% after a moderate increase in third quarter. After a modest gain in the third quarter, net worth rose to $150 trillion during the fourth quarter.

Households held $1.5 trillion more real estate than they did in 2005, while equity assets increased by $2.5 trillion.

Although the economic activity was impacted by the Covid-19 surge and the Omicron variant in 2021’s final weeks, it had little impact on the quarter. The stock market rose to new heights in the fourth quarter. More recently, stocks have slid on concerns about the economic impact from Russia’s invasion of Ukraine.

In the meantime, mortgage rates have increased to levels never seen since 2019 which may eventually slow down the steep price rises in the housing market. 

Next week, the Fed is likely to increase interest rates to combat inflation.

However, not everyone has been able to benefit from the rise in home and equity values. According to survey data, just over half of Americans have stocks and millions rent. A separate report released Thursday indicated that rent for primary residence increased in February, the highest rate since 1987.

Although pandemic assistance programs such as the advanced child tax credit payments and other aid programs have ended, household spending is still supported by high savings. The fourth quarter saw net private savings grow at an annualized rate of $2.4 trillion, but the pace is slowing since 2021. 

The annualized rate at which business debt is outstanding rose to $1.2 trillion in October-December compared to the preceding quarter, and reached $18.5 trillion.

The annualized rate at which federal debt rose from 10.8% in 2005 to $25.3 trillion was 10.8%. Due to the massive federal aid of workers, local governments and businesses during the pandemic, government debt has risen by 10.8% annually.

The fourth quarter saw an increase in consumer credit, not mortgage debt, of $302 billion annually.

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