Affordability is a huge issue in many parts of the country. Lower conforming loan limits may be good for Fannie and Freddie but it’s bad for homebuyers, considering that credit has tightened for jumbo loans and home prices haven’t dropped but five percent after 100 percent gains since 2000.
Housing sales have dropped over 20 percent to less than a half-million housing units sold year over year. That’s the October report from the National Association of Realtors. The NAR blames less than aggressive lending. If people can’t get loans, they can’t buy houses. The news was worse from states where home values fall within the “jumbo” limits.
The Office of Federal Housing Enterprise Oversight kept 2008 conforming loan limits purchased by Fannie Mae and Freddie Mac at $417,000, but it’s considering lower limits if housing prices continue to fall. Meanwhile, The House is trying to get higher Enterprise loans limits passed, but the Senate won’t cooperate.
source: sundaymorningtalk.com
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