The Federal Housing Administration share of the single-family loan market has shrunk to 3.5% in 2004, as its traditional customers are increasingly attracted to conventional low-downpayment products.FHA originations in calendar year 2004 totaled $93.8 billion, according to the agency, down from $164.6 billion in 2003. National Mortgage News estimates that single-family originations (conventional and government-guaranteed loans) totaled $2.69 trillion in 2004, which makes the FHA's market share 3.5%. The agency's share was 4.2% in 2003. The FHA commanded over 10% of the market a few years ago. Several sources said one of the reasons for the market decline is that the FHA lacks a 5/1 hybrid adjustable-rate product that is competitive with widely available conventional products.

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