Conforming Limits Raised

For properties in the United States (except Alaska, Hawaii, Guam and the U.S. Virgin Islands):

• $417,000 for mortgages on one-family properties (up from $359,650)
• $533,850 for mortgages on two-family properties (up from $460,400)
• $645,300 for mortgages on three-family properties (up from $556,500)
• $801,950 for mortgages on four-family properties (up from $691,600)
  

For properties in Alaska, Hawaii, Guam and U.S. Virgin Islands:

• $625,500 for mortgages on one-family properties (up from $539,475)
• $800,775 for mortgages on two-family properties (up from $690,600)
• $967,950 for mortgages on three-family properties (up from $834,750)
• $1,202,925 for mortgages on four-family properties (up from $1,037,400)
  

The increase in loan limits is based on the October-to-October changes in the average house prices, as published by the Federal Housing Finance Board, (FHFB), and on Supervisory Guidance issued by the Office of Federal Housing Enterprise Oversight (OFHEO).

C.A.R. REPORTS MEDIAN HOME PRICE INCREASED 17.2 PERCENT IN OCTOBER

The median price of an existing, single-family detached home in California during October 2005 was $538,770, a 17.2 percent increase over the revised $459,530 median for October 2004, C.A.R. reported. The October 2005 median price decreased 1 percent compared with September's $543,980 median price."While California is still experiencing year-over-year double-digit price appreciation, prices are starting to level off compared with the statewide peak reached in August 2005," said C.A.R. President Vince Malta. "Regionally, the median price continues to post strong gains, with the High Desert, Riverside/San Bernardino, and San Luis Obispo regions hitting record highs last month."Closed escrow sales of existing, single-family detached homes in California totaled 621,530 in October at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity decreased 2.8 percent from the 639,570 sales pace recorded in October 2004.
(Reprinted from CAR Newsline 11/30/05)

REVISED CONFORMING LOAN LIMITS FALL SHORT

Revised Fannie, Freddie loan limits will benefit homebuyers,but don't go far enough to improve homeownership opportunities in California
LOS ANGELES (Nov. 29) – More than 28,590 families in California will be able to benefit from Fannie Mae's and Freddie Mac's announcements today that each will increase its single-family mortgage loan limit from $359,650 to $417,000 in 2006, according to an analysis by the California Association of REALTORS® (C.A.R.).
"While this is good news for many homebuyers, Fannie Mae’s and Freddie Mac's new loan limits do not go far enough to benefit most homebuyers in California," said C.A.R. President Vince Malta. "Conforming loan limits need to more accurately reflect the cost of housing in California, where the median price of a home is more than double that of the nation."
The current median home price in California is $538,770, an increase of 17.2 percent compared to a year ago and more than 29 percent higher than the national conforming loan limit of $417,000. In addition, California has 19 counties with a median-home price above the national conforming loan limit.
Based on its 2006 sales projection, C.A.R. expects that 304,700 sales in the state will fall into the price range implied by the higher loan limits, an increase of 72,070 homes over the 2005 loan limits. The $57,350 increase in the single-family mortgage loan limit translates into an additional 28,590 households able to take advantage of savings provided by having a Fannie Mae or Freddie Mac qualifying mortgage.
(reprinted from CAR newsline 11/30/05)