WASHINGTON – Nov. 28, 2018 – In response to rising home prices, the Federal Housing Finance Agency (FHFA) will raise the national conforming loan limit for 2019 by 6.9 percent – from $453,100 this year to $484,350 next year.
In addition, the high-cost limit – an amount used in areas with notably high home prices, such as San Francisco – will rise from $679,650 to $726,525.
In Florida, Monroe and Miami-Dade counties may be able to access higher-limit conventional loans. For an overview of maximum loans by U.S. county, visit FHFA's website. Overall, loan limits will be higher in all but 47 counties or county equivalents across the country beginning Jan. 1, 2019.
In addition, Federal Housing Administration (FHA) loans generally adopt the same loan limits set by FHFA, though 2019 changes have not yet been announced.
The conforming loan limit determines the maximum size of a mortgage that government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac can buy or "guarantee." Non-conforming (higher than this maximum) or "jumbo loans" typically have tighter underwriting standards and sometimes carry higher mortgage interest rates than conforming loans.
"The National Association of Realtors® is pleased to see the Federal Housing Finance Agency raise its national conforming loan limits for 2019," says NAR President John Smaby. Today's decision reflects rising or near-record-high home prices in many U.S. markets, and the move helps keep the American Dream within reach for countless families working with Fannie Mae and Freddie Mac. Without this assurance that loan limits keep up with home price growth, borrowers across the country risk being pushed out of the market altogether as mortgage rates and rising home prices continue to hold back potential homebuyers."
At the end of each year, FHFA updates the national and high-cost limits based on the FHFA's national price index.