Today, in the Calculated Risk Real Estate Newsletter: How Much will the Fannie & Freddie Conforming Loan Limit Change for 2024?
A brief excerpt: With house prices mostly unchanged over the last year, an interesting question is: How much will the Fannie & Freddie conforming loan limits (CLL) change for 2024? And how much will the FHA insured loan limits change?
First, there are different loan limits for various geographical areas. There are also different loan limits depending on the number of units (from 1 to 4 units). For example, currently the CLL is $726,200 for one-unit properties in low-cost areas. For high-cost areas like Los Angeles County, the CLL is $1,089,300 for one-unit properties (50% higher than the baseline CLL).
The CLL for each county is available at 2023 Conforming Loan Limits (excel file).
The limit is updated annually, and is adjusted using the FHFA’s quarterly national, seasonally adjusted, expanded-data index: Expanded-Data Indexes (Estimated using Enterprise, FHA, and Real Property County Recorder Data Licensed from DataQuick for sales below the annual loan limit ceiling). The adjustment is based on the House Price Index value in Q3 divided by Q3 in the prior year. The FHFA index is a repeat sales index, similar to Case-Shiller.
Currently we only have data for Q1 2023 for the quarterly index (up 5.9% from Q1 2022), and the monthly House Price Index was up 2.8% YoY through May 2023.
We need the house price data through September 2023 to calculate the conforming loan limit for 2024. This quarterly data will be released in late November.There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/