Week 18, 2007

The U.S. House Financial Services Committee on Thursday passed legislation allowing the Federal Housing Administration to offer borrowers a safer alternative to risky mortgage products and to help many home owners facing foreclosure. The legislation — titled the Expanding American Homeownership Act of 2007 — would increase loan limits, eliminate the statutory 3 percent minimum cash down payment, and give FHA flexibility to provide risk-based pricing. The bill will next go before the full House of Representatives for a vote.
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Mortgage Rates Hold Steady. Sluggish growth in the U.S. economy kept mortgage rates in a holding pattern this week, reports Freddie Mac, as investors viewed the trend as a sign that inflationary pressures will ease. According to the company's weekly survey of borrowing costs, average interest on 30-year fixed loans held steady at 6.16 percent after dipping during the previous two weeks. The rate is just shy of the early March level of 6.14 percent, which is the lowest so far in 2007. Rates on 15-year fixed mortgages also stood pat for the week, averaging 5.87 percent.

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Some Facts & Figures About Second-Home Sales

• New homes make up a large share of the market.: 44 percent of vacation-home buyers and 36 percent of investment-home buyers.
  
• Most buyers are married couples, including 78 percent of vacation-home buyers and 68 percent of investment buyers
  
• Most used real estate agent. Sixty percent of vacation-home buyers and 54 percent of investment buyers purchased through a real estate agent or broker.