As investors wait to see what the Federal Reserve will do next week with interest rates, 30-year mortgage rates fell for the fourth week in a row.

As of Thursday rates on 30-year, fixed rate mortgages averaged 5.66 percent for the week ending Jan. 27, according to a weekly survey by Freddie Mac.

Fed policy-makers will hold their first meeting of 2005 next Tuesday and Wednesday. Most believe they will increase a key short-term rate for the sixth time since last June.

Rates on 15-year, fixed-rate mortgages, a popular option for refinancing, dipped this week to 5.14 percent. Rates on one-year adjustable-rate mortgages were 4.18 percent this week.

Five-year hybrid adjustable rate mortgages averaged 5.02 percent this week.

A year ago, rates on 30-year mortgages averaged 5.68 percent with 15-year mortgages at 4.97 percent and one-year ARMs at 3.59 percent.

"There is no national bubble. We're sort of calling it the 'Don Ho' phenomenon, where there are Tiny Bubbles," said Doug Duncan, the Mortgage Broker Association's chief economist. Rising interest rates will put a brake on home sales in coming years, but steady economic growth and low unemployment should keep housing prices from slipping, a forecast said Thursday.

Click here for the complete article on CNNMoney.com

According to Money, Yale economist Robert Shiller worried about stocks in 2000. Now he's worried about real estate, arguing that housing in many cities is undergoing the same irrational exuberance as stocks did in their bubble days.

Click here for the complete Money real estate story.

Need a Los Angeles Real Estate Agent or Mortgage Broker?

With mortgage rates continuing to drop, one might expect a surge in mortgages.

Last week, the average mortgage rate was 5.58%, the lowest level since October 2004, but mortgage applications were yet down again.

One-year adjustable-rate mortgage rates averaged 4.21 percent.

Of course, such data always ensures real estate bubble talk. Overall, most analysts think the market is relatively stable.

"I attribute the spike in refinance applications over the last two weeks to continued low interest rates and a build up created by the inactivity of the holiday season," said Neil B. Garfinkel, Esq., a lawyer at a New York-based real estate law firm. (Read more on this Reuter's story)

The California Assn. of Realtors predicted another strong year for the real estate market, with the state's median home price slated to rise 5.6%, reported the LATimes.com

Of course, it still comes down to interest rates - how far and fast they rise.

It has become almost accepted as fact that rates will rise this year, probably close to 7 percent. That increase will make Los Angeles and most of Southern California unaffordable for the far majority of residents.

Nonetheless, homes are expected to appreciate in price by almost 6 percent. While considerably lower than the double digit gains of last year, such a gain would still be historically high.

Many analysts and economists seem to believe that if the economy can strengthen, most California real estate markets might continue to appreciate, just at a slower pace.

Read more on this California real estate news story by click here.

According to an article by the LATimes, Not as Bad as it Sounds?, "Though affordability in Southern California looks bleak, the way the numbers are reported may contribute to creating such a dismal picture."

The article points out that income-to-debt ratio changes, as well as ARM loans, have changed the affordability factor in a way this isn't measured. Still, even using this new measure, the affordability factor only increases by about 10 percentage points.

Click here for the complete story.

A special report on CNBC reported that one of the hottest real estate markets in America is downtown Los Angeles.

Anchored by the Staples Center and the new Disney Concert Hall, residential units in downtown Los Angeles have doubled from 1999 to 2005, with significant new developments both underway and planned.

All of the residential activity and a multibillion dollar development around the Staples Center has brought something very rare to downtown - a major grocery store. Ralphs has announced plans to open up a store to service the downtown residential community.

Need a Los Angeles Mortgage Broker or Real Estate Agent?

Rates on 30-year mortgages fell for a third straight week.

Thursday's weekly survey by mortgage company Freddie Mac showed that 30-year, fixed rate mortgages averaged 5.67 percent for the week ending Jan. 20, compared with 5.74 percent last week.

15-year, fixed-rate mortgages, a popular option for refinancing, declined this week to 5.15 percent.

Five-year hybrid adjustable rate mortgages averaged 5.05 percent this week.

Click here for a Los Angeles Mortgage Broker or Real Estate Agent.

Applications for home mortgages increased in the last week ending January 14.

Mortgage industry analysts say consumers are still taking advantage of low rates to purchase homes and refinance mortgages on their homes.

According to industry reports, fixed 30-year mortgage rates averaged 5.64 percent last week, and 5.7 percent the previous week.

Need a Southern California Mortgage Broker, or real estate agent.

Freddie Mac's weekly survey, ending January 6, showed the average 30-year fixed rate mortgage was 5.77, down from 5.81 a week ago.

Last year finished off the year with an average 30-year fixed mortgage of 5.84 percent.

Analysts are still split on the future of mortgage rates for 2005, though the consensus seems to be building that next year will be another great year for the real estate industry.

Most analysts; however, do expect mortgage rates to rise sometime next year. Most expect the first quarter of 2005 to hold under 6 percent. By the end of year, the most common guess is 6.5% - 7.0%.

Other mortgage rates

15-year, fixed-rate mortgages, dropped this week to 5.21 percent, from 5.23 percent last week. One-year adjustable-rate mortgages fell to 4.10 percent this week, from 4.19 percent.

Five-year, “hybrid” adjustable- rate mortgages averaged 5.03 percent this week. This is the first time Freddy Mac has monitored this rate.

Need a Los Angeles Mortgage Broker?

Need a Los Angeles Real Estate Agent?

Due to shortened week, most analysts agree, mortgage applications were down last week, even though mortgage rates actually dropped.

Fixed 30-year mortgage rates averaged 5.67 percent last week, down points from 5.72 percent the week before.

Refinancings, down significantly this year, made up 48 percent of all mortgage applications last week, up from 46.2 percent last week.

One-year adjustable-rate mortgage rates averaged 4.17 percent, up 12 points from the previous week.

Need a Los Angeles California Mortgage Broker?.

Need a Los Angeles Real Estate Agent?

The AP is reporting that some analysts think that interest rates might rise faster than expected, based on minutes from the last Fed meeting on Dec. 14. For the complete story, click here.

You're not the only one.

With homes appreciating by 20% or more per year in much of Southern California, even with historically low mortgage rates, most houses are out of reach for the majority.

Still, homeownership is a significant step towards financial security. Therefore, many worry that if they don't buy now, they might not ever be able to buy.

Even if the appreciation portion of the real estate bubble bursts to low, single digit gains per year, while home prices remain stable and interest rates rise, it will become even harder to buy a home.

Of course, maybe prices will recede buy 20% or more within the next couple of years.

No one really knows.

One of the main ways many real estate investors try to keep some measure of home values is by knowing the rent those homes command. Obviously, if the house can demand a rent that would pay for itself, then you are doing pretty good.

While rents in Los Angeles and throughout Southern California having been rising, in most areas it is cheaper to rent than to own. How significant this difference is should provide some indication of the real value of the house.

Of course this isn't a perfect system, and there are always other variables to consider.

For example, building codes in most areas of Southern California have severely limited new housing in the area, as immigration continues to rise.

So where will everyone live? If this continues, won't this have an effect on rents?

The important thing to remember about real estate, or purchasing a home, is to focus on the long term, according to most real estate analysts. Sure, quick money can be made, but it can be lost just as quickly.

Historically, real estate rises in value. You might have to wait five or ten years, but if you can make your purchases, knowing that you can stay put for at least five years without going into debt, then you should always be in good shape.

Need a real estate agent?

Need mortgage pre-approval?