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UPDATE 1-OFHEO's DeMarco-Mortgage delinquencies on the rise

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NEW YORK, Feb 7 (Reuters) - Serious mortgage delinquencies are rising on subprime loans to a rate not seen since the 2001 recession, and have spread well beyond riskier loans to areas previously deemed much safer, a top housing regulator said.

Edward DeMarco, deputy director of the Office of Federal Housing Enterprise Oversight, told an audience of securities analysts that his organization in March would begin publishing a monthly index of home prices in an effort to better track trends.

Previously, OFHEO, which oversees government-sponsored enterprises Fannie Mae FNM.N and Freddie Mac FRE.N, had only published a quarterly home price index.

“For subprime loans, the seriously delinquent rate is now approaching levels of the 2001 recession,” DeMarco said. “The difference, of course, is that there are now over two times more subprime loans outstanding than there were in 2001.”

“We’re all hearing, and certainly the books of the two enterprises are showing, that delinquences are spreading to other parts of the real estate market,” he added.

OFHEO’s index tracks average single-family house price changes in repeat sales or refinancings of the same homes, and is based on data from Fannie Mae and Freddie Mac.

In its most recent report, on Nov. 29, OFHEO reported the first quarterly home price drop in 13 years in the third quarter of 2007, dragging down the annual price appreciation to the slowest pace since 1995.

Adding a monthly report “has actually been in the works for a while, just to make the data we report more timely,” DeMarco told Reuters on the sidelines of the New York Society of Security Analysts forum.

Another closely watched home price gauge is reported on a monthly basis: the Standard & Poor’s Case-Shiller series. S&P/Case-Shiller also provides quarterly views.

“Both indices have fallen off a cliff recently,” DeMarco told the analysts. (Additional reporting by Pedro da Costa; Editing by Jonathan Oatis)

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