by Calculated Risk August 6, 2024 12:58 PM
Today’s Calculated Risk Real Estate Newsletter: How much will Fannie & Freddie’s conforming loan limits change in 2025?
Short excerpt:
As home prices have risen in the middle of last year, an interesting question arises: What was Fannie and Freddie Mercury doing? Conforming Loan Limit (CLL) What changes are coming for 2025? How much will the FHA-insured loan limits change?
First, different geographies have different loan limits. They also vary based on the number of units (1-4 units). For example, currently, the CLL for a 1-unit property in a low-cost area is $766,550. For a high-cost area like Los Angeles County, the CLL for a 1-unit property is $1,149,825 (50% higher than the baseline CLL).
…This graph shows CLL since 1979. CLL remained unchanged from 2006 to 2016.
To calculate conforming loan limits for 2025, home price data is needed through September 2024. This quarterly data is expected to be available in late November.
…
Based on current YoY home price changes (through May), the CLL for 2025 will likely be closer to $810,000. In high-cost areas like Los Angeles, the limit could rise to $1.2 million or more. However, YoY home price growth has slowed and is likely to remain below 5.7%.
There’s a lot more in the article.
