South Bay Crime Rate Plummets

Cities in the South Bay of Los Angeles enjoyed a 9.1% overall drop in crime during 2005 thanks to large drops in burglaries, auto thefts, and assaults. There has been an overall 51.2% drop in crime since 1995 in the South Bay. Rancho Palos Verdes had a 29.1% drop in reported crimes in 2005, significantly leading the way in the largest percentage decrease in crime since the prior year. Most other cities in the South Bay had percentage decreases ranging from 5.5% to 9.8% (Palos Verdes Estates).

Reasons for the decrease in crime range from the effects of the 3 strikes and your out law, a drop in drug use, an improved economy, a decline in the 18 to 24 year old male population, and proactive policing techniques.

Source: South Bay Daily Breeze 3/19/06

interest Rates as of 3/19/06

Loan Type                                 This week     Last week

	30 yr fixed mtg		5.88%		5.93%
	15 yr fixed mtg		5.57%		5.60%
	5/1 ARM		5.62%		5.63%
	30 yr fixed jumbo mtg		6.18%		6.20%
	5/1 jumbo ARM		5.75%		5.76%

Source: Bankrate.com

Rates include points

Comments on Interest Rates from HSH Associates

Excerpts from 3/17/06 newsletter:

After stomping higher in recent weeks to three-year highs, 30-year fixed rate mortgages (FRM) eased back a little. The average 30-year FRM dipped by two basis points.

While reports of rising inflation and continued strong growth have blown interest rates higher in recent weeks, this week’s cooler breezes of gentler growth measurably soothed the markets. Last week, according to the futures markets, there was a 100% chance that the Federal Reserve would lift rates not only at the end of this month, but also in May. After the cooler winds of data this week, that possibility eased back to less than 100% for March, and perhaps 80% for May.

As a number of Fed governors have made clear, the Fed is more likely to use fresh incoming data to guide policy now that it’s about done with its plan to bring interest rates back up from emergency levels. Certainly, a tempering of growth and inflation removes the likelihood that a more aggressive Fed policy will develop; the sum of this week’s data was in the right direction in that regard.

Mortgage Rates as of 3/10/06

Loan Type                                    Today   Last Wk

	30 Year fixed mtg		5.93%		5.79%
	15 yr fixed mtg		5.60%		5.44%
	5/1 ARM		5.63%		5.52%
	30 yr fixed jumbo mtg		6.20%		6.09%
	5/1 jumbo ARM		5.76%		5.64%

Interest rates include points

Source: Bankrate.com

Interest Rate News from HSH Associates

Newsletter dated 3/3/06:

Fixed mortgage rates ticked just a little lower this week. Statistics for loan terms and types can be found at http://www.hsh.com/stats-index.html. There now seem to be two forces at opposing ends of the economy: housing and… everything else. Soaring prices and tighter financing conditions have crimped affordability and created a slowing in the housing and housing-related sectors of the economy, particularly the building and financing industries.Hopefully, we’re in a healthy (if painful) transition to more sustainable levels for buying, selling and pricing for homes. Both new and existing home sales reports came out this week, and both pretty much told the same tale of slowing sales, rising inventories and cooling price increases.

Treasury yields moved higher this week, especially late week, as concerns about global growth and inflation moved into center stage. It appears that interest rates are likely to rise not only in markets covered by the European Central Bank, but that Japan may even need to begin to move its interest rates higher as growth may have finally taken hold there. Higher rates abroad would lessen appetite for our debt, and the new competition for investor dollars would tend to push rates on US debt higher to remain competitive. In addition, if especially Japan is on the verge of a breakout in growth, the demand for resources which accompany such growth would tend to worsen inflation here. We’ll see how this all rolls out in the weeks ahead.

In the meanwhile, rates do seem poised to move a little higher next week. If spreads are any indication, lenders have been trying to keep from passing along the increase in underlying credit costs to the extent possible. For fixed rate mortgages, the difference between the 10-year Treasury and the average 30-year FRM was 1.97%on January 6; this week, that markup has shrunk to 1.78%, the narrowest since November.