N.J. housing is priciest ; Median costs highest in nation

After a six-year run-up in housing prices, many households in New Jersey are staggering under heavy monthly shelter costs, the U.S. Census Bureau reported today. Among mortgage holders, New Jerseyans in 2005 paid the highest median housing costs in the nation $1,938 a month, including mortgage payments, property taxes, home insurance, condo fees and utilities.
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BUILDER CONFIDENCE DECLINES TO LOWEST LEVEL SINCE FEBRUARY 1991

The confidence level of the nation's home builders declined for the eighth consecutive month in September, a reflection of increased sales cancellations and rising inventories of unsold homes, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The seasonally adjusted HMI stands at 30 this month, down three points from August and down 35 points from a year ago. In the West, the HMI has steadily declined since April and now stands at 38. An HMI below 50 indicates more builders view sales conditions as poor versus good. Newer sites: San Diego hotels - San Diego lasik

Realtors - Housing Values to fall!

September 18, 2006—Housing prices are expected to continue to have a limited fall throughout 2006, according to testimony submitted by the National Association of Realtors at today’s Senate Banking Committee.
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Housing Starts Drop 5.3 Percent in June

Housing Starts Drop 5.3 Percent in June
(Washington - July 19, 2006) - Total housing starts dropped 5.3 percent in June to a seasonally adjusted annual rate of 1.850 million units, according to figures released by the Commerce Department today. This was 11.0 percent below the pace of a year ago.
Single-family housing starts were down 6.5 percent for the month to a pace of 1.486 million units, a 13.8 percent drop from the June 2005 pace. Multifamily housing construction was up 0.3 percent for the month to a seasonally adjusted pace of 364,000 units.
'NAHB's surveys of single-family builders have been showing a steady decline in confidence since the middle of last year, and builders are acting accordingly. They are slowing their production as market conditions and demand cool down,' said David Pressly, president of the National Association of Home Builders (NAHB) and a home builder from Statesville, N.C. "

Home prices could start falling

USATODAY.com - Home prices could start falling: "Home prices could start falling

By Noelle Knox, USA TODAY
For the first time in more than a decade, home prices could start to fall around the country in coming months, the National Association of Realtors said Tuesday after a report showed that sales of existing homes fell in June and the number of homes for sale soared to their highest point since 1997.

Condo prices are already being hit: They fell 2.1% from June last year to a median $226,900 (median means half cost less and half cost more). Prices of single-family homes edged up 1.1% in June to $231,500. With a 6.8-month supply of single-family homes on the market and an eight-month supply of condos, sellers are under more pressure to cut prices, and buyers can be choosy.

David Lereah, NAR's chief economist, said he expects 'price numbers to start deteriorating,' though he still projects home prices will be up 5.3% for the year. "

June Home prices fall!

For June '06, the median home price in San Diego fell for the first time in nearly a decade and sales tumbled in Los Angeles County, according to just released real estate figures.

The median price of all homes sold in San Diego last month fell 1% from the same month last year to $488,000, according to DataQuick Information Systems.

The importance of this, is that the traditionally strongest real estate marketing time is from May through August. For a price drop to occur now,
can only be a harbinger of a much more pronounced drop as we enter into Fall/Winter.

I'm not selling my San Diego home, but have sold all my investment properties.

If one considers the BILLIONS in adjustable loans due for their first adjustment in 2007/8 combined with the huge percentage of 100%loans used to purchase at the height of our market....you have to worry!

But, than again what is so bad about a 20-30% decline in values if we are coming off 100% increase over the last five years?

I'll answer my own question....nothing so bad as long as you were not speculating, purchased beyond your means or refinanced you property at 90% or more of its high value.
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San Diego County home prices take a tumble

SignOnSanDiego.com > News > Business -- San Diego County home prices take a tumble: "By Roger M. Showley
UNION-TRIBUNE STAFF WRITER
11:45 a.m. June 13, 2006
SAN DIEGO – San Diego County's home prices took their biggest tumble for any spring on record last month, DataQuick Information Systems reported Tuesday.
The median price of all homes sold in May was $490,000, down $15,000 from April, although it was still slightly higher than a year ago.
Snapshot: Home/condo sales May '05– May '06


Sales slowed for the 23rd straight month on a year-over-year basis, reaching 4,217 transactions in new and existing homes and condos.
Local real estate agents reported about seven months' worth of unsold inventory, but argued that the pace of activity reflects a normal market rather than a crash."

Global property cycle's peaked, Morgan Stanley says - MarketWatch

Global property cycle's peaked, Morgan Stanley says - MarketWatch: "Growing evidence of real-estate 'bust'
Fallout for consumers and corporate profits, eonomist says
E-mail | Print | | Disable live quotes By Chris Oliver, MarketWatch
Last Update: 6:47 AM ET Jun 29, 2006


HONG KONG (MarketWatch) -- Evidence is mounting that the global property cycle is turning down, as rising interest rates and heightened inflationary pressures combine to put the brakes on demand for real estate, according to a Morgan Stanley report.
The shift ushers in an end to what's been a six-year rally during which the twin forces of globalization and financial innovation fed an upturn in the property cycle that became a worldwide phenomenon, said economist Andy Xie, in an Asia Pacific strategy report released Thursday.
'Due to deflation shocks, global inflation has been low, which allowed major central banks to keep interest rates very low, in turn fueling property,' Xie said. 'As inflation picks up simultaneously around the world, interest rates are rising everywhere, and the property boom is turning into a bust.' "

It's Only Going to Get Worse!

Payment Shock in Store For ARM Borrowers, More Foreclosures in Future? - NationalRealtyNews.com: "Payment Shock in Store For ARM Borrowers, More Foreclosures in Future?
Thursday, June 22, 2006 - By Staff Writer, National Realty News

STUART, FL - Many borrowers who mortgaged their homes with adjustable rate mortgages while rates were at historic lows will soon be in store for a payment shock and the economy overall will certainly feel the effects. Some experts say prepare for a rise in delinquency rates and foreclosures.

Bankrate.com reports that over the next 18 months, more than $1 trillion of adjustable-rate mortgages will be hitting their first reset date. Assuming the average loan amount is $200,000, that amounts to 500,000 mortgages. The typical homeowner will be forced to seriously readjust their monthly budget when they go from paying on an interest only loan or a loan with a low starting rate to one that now requires playing catch up on the principal. Many borrowers will simply not be prepared for a sudden change that may require them to pay double more than they paid the previous month for their mortgage. Industry experts say this will fuel another year of increases in mortgage delinquency rates and foreclosures.

The effects will be evident in the economy overall, as well. That consumer who is suddenly paying more for their mortgage - and who is already feeling the heat due to high fuel prices - is most likely forced to cut back on spending money elsewhere - especially for consumer products and services. "
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BUILDER CONFIDENCE FALLS TO LOWEST POINT SINCE APRIL 1995

The confidence level of the nation's home builders continues to decline in 2006, falling this month to its lowest reading since April 1995, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The seasonally adjusted HMI stands at 42, down four points from May's revised reading of 46. An HMI above 50 indicates that more builders view sales conditions as good versus poor. According to NAHB, declining demand from investors, rising mortgage interest rates, and continued affordability issues all contributed to the decrease in builders' outlook for the new home market.

All three HMI components declined in June. The component measuring sales expectations declined five points to 50, while the components gauging current single-family sales and buyer traffic decreased to 47 and 29, respectively. Home builder confidence edged down across the nation in June, and in the West builder confidence declined one point to a seasonally adjusted HMI of 61.
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Smart money is leaving the real estate market

Rockford's Newspaper Rock River Times | rockford illinois news information: "Dr. Christopher Thornberg, a member of the forecast staff, told a blog called The Housing Panic: “Actually, what we are seeing is a very typical slowdown in the market so far—there is nothing particularly soft about it (the landing in bubble markets). The claim is that because unit sales are falling but prices are still going up, that this is an unusual slowing. The fact is that most breaking markets start with activity, and it takes three to four quarters for that to take all the wind out of price appreciation. How hard it will be, remains to be seen.”"
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Foreclosures Moving Up in San Diego

Foreclosures Continue to Rise in Southern California, Says Default Research: "Real estate bubble continues to deflate in Southern California, expert says

RISMEDIA, June 20, 2006—The number of foreclosures escalated throughout Southern California, with a rise of 29.09% since January 2006, according to Default Research (www.defaultresearch.com), the rapidly growing real estate research company for foreclosure properties.

While Riverside had the highest increase of 56.45%, San Diego County had an increase of 49%, followed by Los Angeles up 16.2%.
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Interest rates to move higher!

Inflation Outlook Likely to Push Rates Still Higher
Wednesday, June 14, 2006 - By Staff Writer, The Originator Times
Click to Review

STUART, FL – Mortgage professionals everywhere have been wondering if interest rates will continue to rise and whether the Fed will hike short-term rates for the 17th consecutive time on June 29.
Looking at this week’s key economic briefings and results, all signs points to yes. The Fed will likely increase short-term rates by a quarter of a point. Anticipating this action, the bond market is apt to similarly push long-term mortgage rates higher. "
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Bubble Trouble? What to make of all the real estate trend news

Bubble Trouble? What to make of all the real estate trend news: "Some economists -- typically, those who have staked their professional reputations on being dark-horse skeptics -- are predicting nothing short of a global economic apocalypse. Others -- often those on the take from the real estate industry -- scoff at such dire visions. Don't listen to the doomsayers, they say, 'we're in for a soft landing.'
But how these perspectives affect the average gal with a mortgage or the ordinary dude with a dream of buying his own house is anything but clear. So who do you listen to, and what does it all mean?
On a basic level, the real estate experts can't really quibble about the basic facts: Many once-hot markets are showing signs of a cold front this summer. The Federal Reserve Board is expected to raise interest rates again to ward off inflation, and banks have begun to curb their promiscuous dispensing of risky, low-down loans. These factors will contribute to making real estate less appealing to many investors. Sure, people still need to live in houses, but the people who need to pour extra dollars somewhere may take a breather from speculative acrobatics to search for other investment circuses. (Can you say 'oil futures' three times fast?) "
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Fed Chief - Cooling Housing Market

Housing Cool-Down Is 'Orderly,' Fed Chief Says: "Housing Cool-Down Is 'Orderly,' Fed Chief SaysBy Tomoeh Murakami TseWashington Post Staff WriterFriday, May 19, 2006; Page D01Confirming what home buyers suspected and real estate sales figures have indicated for months, Federal Reserve Chairman Ben S. Bernanke said yesterday that the U.S. housing market was showing clear signs of cooling off.

Bernanke said the slowdown is 'moderate' and 'orderly' and pointed to the overall strength of the economy

Economist Dean Baker of the Center for Economic Policy and Research expressed concern that rising interest rates were squeezing homeowners who took out interest-only and adjustable-rate mortgages. Even when interest rates were at historically low levels, Baker said, stretched buyers were taking out exotic loans to get into pricey homes.

Baker said a rising inventory of homes in the Washington region could fuel a double-digit price decline if interest rates climb higher. Condo prices could fall by as much as 30 percent, and prices of single-family homes could drop by as much as 15 percent, he said.
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Inside Bay Area - Bay Area real estate sales hit 5-year low

Inside Bay Area - Bay Area real estate sales hit 5-year low: "Bay Area real estate sales hit 5-year low
By Eve Mitchell, BUSINESS WRITER



Sundays — the days when many real estate professionals set up open houses — have been a lot quieter lately for Daniel Joe, a Redwood City-based Realtor.
Call it one of the hidden signs of the slowing real estate market, which last month saw the lowest level of Bay Area home sales in five years, according to a report Thursday from DataQuick Information Systems. It started last spring, when sales dropped off as the number of homes on the market began to rise and so did interest rates. Now sales are sliding, interest rates are even higher and prices are increasing at a lower rate.
When the housing market was hot, so was attendance by prospective buyers at open houses. Not so in today's cooling market.
'I don't see a whole bunch of people walking through the properties all at one time,' said Joe, who works at Realty World Hirsch & Associates in Redwood
City.
The Bay Area median price did reach a new record in April, DataQuick said. But the new peak of $628,000 is not that much to get excited about, given that sales volume dropped 25.1 percent from a year ago.
Some 8,358 new and resale condominiums changed hands in the Bay Area last month — the slowest April since 2001 when 7,193 homes were sold, and a 14.2 percent decline from March. "
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Home Sales at Five Year Low

May 16, 2006La Jolla,CA----Home sales in Southern California decelerated in April to their slowest pace since 2001, the result of higher mortgage interest rates and less buyer urgency. Prices rose at a single-digit appreciation rate for the first time in more than four years, a real estate information service reported.
A total of 24,748 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in April. That was down 16.1 percent from 29,509 in March and down 21.3 percent from 31,431 in April last year.
The year-over-year sales decline was the steepest since April 1995, when home purchases slowed 24.0 percent. Last month's sales count was the lowest for any April since 24,120 homes were sold in April 2001. DataQuick's statistics, which go back to 1988, show an average April for the nineteen years saw 23,660 sales.
"March and April have shown us that the boom phase of this cycle is behind us, so now it's just a question of how the cycle ends. Right now it looks like changes in the real estate market are happening gradually. But there's a lot of uncertainty among analysts regarding the effect of higher interest rates and how fast the economy is generating demand in regional markets," said Marshall Prentice, DataQuick president.

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Southern California real estate

DQNews - Southern California Press Release: "Southland passes half million mark
April 18, 2006
La Jolla,CA----The median price paid for a Southern California home passed $500,000 for the first time last month as sales continued to decline, the result of higher mortgage interest rates and a real estate cycle that has passed its frenzy phase, a real estate information service reported.
The median price paid for a home in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties was $501,000 last month. That was up 4.4 percent from $480,000 in February and up 14.1 percent from $439,000 for March a year ago, according to DataQuick Information Systems.
The regional year-over-year increase in median has varied from 12.9 percent to 17.0 percent the last 12 months. Last month's increase ranged from 5.7 percent in San Diego County to 23.2 percent in San Bernardino County.
'We still expect the annual increase in median to go down into the single digits sometime this summer. San Diego County is still the market furthest along in this cycle. Price increases there have been below ten percent the last eleven months,' said Marshall Prentice, DataQuick president.
A total of 29,509 new and resale Southland homes were sold last month. That was up 48.2 percent from 19,905 in February and down 9.7 percent from 32,674 for March last year.
An increase from February to March is normal for the season. Sales have declined on a year-over-year basis the last 4 months. "
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Southern California real estate

DQNews - Southern California Press Release: "Southland passes half million mark
April 18, 2006
La Jolla,CA----The median price paid for a Southern California home passed $500,000 for the first time last month as sales continued to decline, the result of higher mortgage interest rates and a real estate cycle that has passed its frenzy phase, a real estate information service reported.
The median price paid for a home in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties was $501,000 last month. That was up 4.4 percent from $480,000 in February and up 14.1 percent from $439,000 for March a year ago, according to DataQuick Information Systems.
The regional year-over-year increase in median has varied from 12.9 percent to 17.0 percent the last 12 months. Last month's increase ranged from 5.7 percent in San Diego County to 23.2 percent in San Bernardino County.
'We still expect the annual increase in median to go down into the single digits sometime this summer. San Diego County is still the market furthest along in this cycle. Price increases there have been below ten percent the last eleven months,' said Marshall Prentice, DataQuick president.
A total of 29,509 new and resale Southland homes were sold last month. That was up 48.2 percent from 19,905 in February and down 9.7 percent from 32,674 for March last year.
An increase from February to March is normal for the season. Sales have declined on a year-over-year basis the last 4 months. "
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Study Indicates Rise In Hispanic Home Ownership

Study Indicates Rise In Hispanic Home Ownership - Yahoo! News: "Study Indicates Rise In Hispanic Home Ownership Thu May 11, 8:37 PM ET


While the overall housing market continues to slow, one success story continues to flourish -- the housing boom for Hispanic homebuyers.
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After years of renting, Priscilla Saavedra and her husband, Vicente, took the plunge in mid-April, buying a two-bedroom townhouse in San Marcos.
'We're starting to build a family, nice to be finally home,' said Priscilla Saavedra.
Saavedra is not alone.
Across the country, the number of Hispanic homebuyers is climbing dramatically, especially if you look at the name game.
An analysis of public records by San Diego-based DataQuick reveals the top 10 most common homebuyer names in 2005.
On this list appear four Hispanic names, double the amount of 5 years ago.
Included on the list are: Rodriguez, Garcia, Hernandez, and Gonzalez.
The story in California is even more revealing, where the five most common surnames are Hispanic.
Almost 28 percent of all homebuyers in the state are Hispanic, according to a 2005 study."

60% Increase in Foreclosures!

First-quarter foreclosure activity in the state jumped to its highest level in two years, including a nearly 60 percent rise in San Diego County, a real estate information service reported Tuesday.

"A number of factors are driving defaults higher," said Marshall Prentice, president of La Jolla-based DataQuick. "The main one right now is that home values are rising more slowly than they have been the past couple of years, which makes it more difficult for homeowners to sell their homes and pay off the lender."

According to DataQuick, lenders sent 18,668 default notices to California homeowners in the first three months of the year. That's a 23.4 percent increase over the previous quarter and a 28.7 percent jump over the same period last year.
In San Diego County, lenders sent 1,533 default notices in the first quarter, a 59.7 percent jump over the same quarter of 2005, when 960 notices were sent.

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San Diego home sales fall

For March 2006, The number of homes sold continued to drop across Southern California -- with the exception of Riverside County, which saw a 6 percent increase in home sales. In San Diego County, there were 4,146 home sales last month. That represents a 17.4 percent drop from the 5,018 sales in March 2005.Across Southern California -- including Los Angeles, Orange, San Diego, Riverside, San Bernardino and Ventura counties -- there were 29,509 home sales last month, down 9.7 percent from March 2005, when 32,674 homes were sold.

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Overvalued Housing!

From a CNN article published 4-7-06 and a Local Market Monitor calculation the following California cities were shown to be overvalued as to their equilibrium value -- what the typical house should sell for!


San Diego CA - 67% - Overpriced

San Jose CA - 62% - Overpriced

San Francisco-Oakland CA - 53% - Overpriced

Sacramento CA - 57% - Overpriced

Riverside-San Bernardino CA - 63% - Overpriced

Los Angeles-Anaheim CA - 56% - Overpriced

Fresno CA - 51% - Overpriced

Santa Barbara-Santa Maria CA - 83% - Overpriced

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Cooling Housing Market!

Red-Hot Housing Markets Cooling Down(April 12, 2006) -- Housing that last year was selling in a matter of hours — Florida coastline condos, townhouses in Washington, D.C., and desert haciendas in Arizona — are now languishing on the market.Home sales have declined 20 percent in Florida, according to the Florida Association of REALTORS®. And in California, sales dropped 15 percent. Sales were off by 19 percent in Washington. D.C., and down 25 percent around Phoenix. Experts blame a number of factors, including a sell-off among investors, worsening affordability due to soaring property prices and rising interest rates. In Florida, last year’s active hurricane season discouraged some buyers.But economists note that while sales in some markets are weaker, they aren't collapsing — just settling into a normal market pace. Inventories are rising but not to an alarming level, and demand for homes is actually posting gains in cities where prices are still considered bargains, such as Indianapolis and Houston.Source: The Wall Street Journal, by Michael Corkery (04/12/06)

Rates Move Higher!

McLEAN, VA -- Freddie Mac released the results of its Primary Mortgage Market SurveySM in which the 30-year fixed-rate mortgage (FRM) averaged 6.49 percent, with an average 0.6 point, for the week ending April 13, 2006, up from last week’s average of 6.43 percent. Last year at this time, the 30-year FRM averaged 5.91 percent. The 30-year FRM has not been higher since the week ending July 12, 2002, when it averaged 6.54 percent.The average for the 15-year FRM this week is 6.14 percent, with an average 0.5 point, up from last week’s average of 6.10 percent. A year ago, the 15-year FRM averaged 5.46 percent. The 15-year FRM has not been higher since the week ending June 13, 2002, when it averaged 6.17 percent.

Buying a House - MSN Real Estate

Buying a House - MSN Real Estate: "Los Angeles: The City of Angels has been described as the poster child for how a lack of new housing near employment centers can hurt an economy. Affordable housing has been an issue in the market for years. It's ranked as one of the least affordable places in the country to live, with housing prices consuming 91% of income, according to statistics from John Burns Real Estate Consulting. The median price of an existing single-family home was $568,000 at the end of 2005, the National Association of Realtors reports. Plus, job growth is virtually flat. Together, it's cause for real estate market consultant Gollis to predict that the prices for California coastal markets are topping out in single-family homes. Fortune predicts a drop-off of nearly 8% in housing prices in the next two years, putting it in 95th out of 100 markets for growth. "

Buying a House - MSN Real Estate

Buying a House - MSN Real Estate: "Los Angeles: The City of Angels has been described as the poster child for how a lack of new housing near employment centers can hurt an economy. Affordable housing has been an issue in the market for years. It's ranked as one of the least affordable places in the country to live, with housing prices consuming 91% of income, according to statistics from John Burns Real Estate Consulting. The median price of an existing single-family home was $568,000 at the end of 2005, the National Association of Realtors reports. Plus, job growth is virtually flat. Together, it's cause for real estate market consultant Gollis to predict that the prices for California coastal markets are topping out in single-family homes. Fortune predicts a drop-off of nearly 8% in housing prices in the next two years, putting it in 95th out of 100 markets for growth. "

Buying a House - MSN Real Estate

Buying a House - MSN Real Estate: "Los Angeles: The City of Angels has been described as the poster child for how a lack of new housing near employment centers can hurt an economy. Affordable housing has been an issue in the market for years. It's ranked as one of the least affordable places in the country to live, with housing prices consuming 91% of income, according to statistics from John Burns Real Estate Consulting. The median price of an existing single-family home was $568,000 at the end of 2005, the National Association of Realtors reports. Plus, job growth is virtually flat. Together, it's cause for real estate market consultant Gollis to predict that the prices for California coastal markets are topping out in single-family homes. Fortune predicts a drop-off of nearly 8% in housing prices in the next two years, putting it in 95th out of 100 markets for growth."

Home Mortgage Applications Drop!

WASHINGTON, D.C. - The Mortgage Bankers Association released its Weekly Mortgage Applications Survey for the week ending April 7. The Market Composite Index, a measure of mortgage loan application volume, was 579.4, a decrease of 5.5 percent on a seasonally adjusted basis from 612.8 one week earlier. On an unadjusted basis, the Index decreased 5.1 percent compared with the previous week and was down 14.7 percent compared with the same week one year earlier.The seasonally-adjusted Purchase Index decreased by 4.7 percent to 417.7 from 438.2 the previous week whereas the Refinance Index decreased by 6.6 percent to 1532.4 from 1640.8 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which decreased 5.0 percent to 854.9 from 900.3 the previous week, and the Government Index, which decreased 10.2 percent to 120.0 from 133.6 the previous week.

Housing inventory way up!

Rising inventory of unsold homes points to a cooling of the market: " Kathleen Pender Sunday, April 9, 2006 In another sign that the real estate market is cooling -- but not collapsing -- the inventory of unsold homes in California is roughly double what it was a year ago. Inventory is calculated by dividing the number of homes for sale in a region by the number of homes that have closed escrow in the past month. It tells you how many months it would take hypothetically to sell all the homes on the market. Statewide, the inventory of unsold single-family homes in February was 6.7 months, up from 3.2 months in February of last year.

'For the better part of 2005, it was in the 3- to 3.5-month range,' says Robert Kleinhenz, deputy chief economist with the California Association of Realtors. 'We saw a rather dramatic increase at the state level beginning in January of this year and continuing in February.'

Inventories are generally higher in Southern than in Northern California. "

Two-Thirds of Lenders Nationwide Say U.S. in Midst of Real Estate Bubble

Two-Thirds of Lenders Nationwide Say U.S. in Midst of Real Estate Bubble: "RISMEDIA, April 6, 2006—Two-thirds of lenders nationwide believe a real estate bubble currently exists in the United States - and half of them believe it has already begun to burst or will burst in the next six months, according to the results of this quarter's Phoenix Management 'Lending Climate in America' Survey.

A significant 93 percent of lenders surveyed expect an anticipated housing correction to result in real estate prices declining 10 to 20 percent across the country.

'In the minds of lenders, the housing bubble has moved from 'Loch Ness monster' myth status to an economic reality that could have a significant, negative impact on the lives of many Americans,' said Michael E. Jacoby, Managing Director and Shareholder of Phoenix Management Services. 'A year ago, 46 percent of lenders believed we were in a housing bubble. Today, that number has climbed to 66 percent - and many of them believe a correction is imminent and could lead to a drop in housing prices of up to 20 percent.'

When asked when they believed the housing bubble would burst, thirty percent of lenders said it has already begun to happen. Twenty percent predicted it would occur in the next one to six months, and 27 percent thought it would happen seven to 12 months from now. Nine percent said it would occur in 2007.

Among the 92 lenders who participated in this quarter's survey, only nine percent said they did not believe a housing bubble existed. "

Mortgate Rates Move Higher

The average 30-year fixed mortgage rate jumped to 6.43 percent from 6.35 percent during the week ended April 6, according to Freddie Mac.Interest on 15-year fixed loans edged up to 6.10 percent from 6 percent over the same period. Meanwhile, the one-year adjustable mortgage rate rose to 5.57 percent from 5.51 percent; and the five-year hybrid ARM surged to 6.11 percent from 6.02 percent. Source: The Wall Street Journal (04/07/06)