MORTGAGE NEWS YOU CAN USE

Rate Watch - Mortgage rates rose on solid job news after holding steady the previous week. The 30-year fixed mortgage rate averaged 6.21% for the week ending Jan. 11, up from 6.18% the prior week, according to Freddie Mac. 15-year fixed mortgages also rose slightly to 5.96% from 5.71% the prior week. A year ago, the 30-year fixed-rate mortgage averaged 6.15%.

The economic calendar for this week is light with no high-impact releases until tomorrow's Retail Sales report.

Ann Arbor Buyer and Seller Tidbits - From the 2006 Profile of Home Buyers and Sellers prepared for Ann Arbor Area Board of Realtors by the National Assoc. of Realtors.

The median age of all buyers (first-time and repeat) was 40 years old - 31 for first-timers and 47 for repeat buyers in Ann Arbor (roughly the same nationwide). The median household income of all buyers in A2 was $78,300 (for the U.S. $71,800).   42% of home buyers in A2 were first-timers. The median price of all homes purchased in A2 area was $224,500 vs. $214,000 for the U.S. 

Casting their predictions for the New Year, many independent analysts say the US economy will remain on a bumpy course in 2007 as fallout from the housing downturn continues. Global Insight chief economist Nariman Behravesh concedes that the residential property slowdown has not much affected consumers - who continue to pump their dollars back into the economy, encouraged by a healthy jobs market. However, the housing slump will likely mean higher unemployment numbers; Goldman Sachs economists figure that realty agents, mortgage brokers, construction, and other housing-related industries will shed more than 1 million jobs over the next two years as the housing market powers down after a five-year run. Hopes for a "soft landing" are not dead, however; and observers say that, barring unexpected jolts to the economy, the economic slowdown is not likely to turn into a full-blown recession

A new study from the Consumer Federation of America reveals that 38.8% of borrowers who took out subprime loans last year were women, a group that accounts for 30% of overall mortgage borrowers. The report also reveals that women with high incomes were 46.4% more likely than men with comparable incomes to have the more expensive mortgages.

According to a nationwide poll conducted by the Pew Research Center, which queried approximately 2,000 homeowners, about 55% of US homeowners expect the value of their homes to rise a little, while 26% expect those values to go up a lot. About 34% of home owners say their homes account for all or most of their personal financial worth, while another 34% say it represents half of their worth.  The survey also found 75% of all home owners say they are currently paying a mortgage, with 20% carrying either a second mortgage or a home equity loan. That percentage rises to 28% among younger home owners ages 30 to 49. The survey found 24% of all home owners have a second home or an investment property they own. Researchers found that the degree of optimism is contingent on both the respondents' location as well as the value of their residences.

Disclaimer: The information contained in this newsletter has been gleaned from various sources and is intended to be current and accurate, however we cannot and do not warrant or guarantee as such. This newsletter is for informational purposes only and is not intended to be, nor should be considered as, investment advice. It does not take into consideration the financial circumstances, needs or investment objectives of any specific person who may receive this newsletter. Individuals should seek financial advice with regard to specific circumstances before making any investment decision.

©Copyright 2006 Ann Arbor Mortgage Company, LLC