Effective on or after January 1, 2020 through December 31, 2020, Freddie Mac and Fannie Mae will be increasing loan limits to $510,400 in most counties across the country.
Required by the National Housing Act to set single-family home loan limits at 115% of median home prices throughout the country, the Federal Housing Authority calculates “floors” and “ceilings” for loans generated via Freddie Mac and Fannie Mae. The “floor” limit for “low-cost” areas where 115% of the median home price is less than a median priced home, the floor limit is $331,700 or 65% of the national conforming loan limit of $510,400.
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Over time, loan limits for Fannie and Freddie have increased in more and more counties across the country. Take a look:
- 2016 – increased loan limits in 188 counties
- 2017 – increased loan limits in 2,948 counties
- 2018 – increased loan limits in 3,011 counties
- 2019 – increased loan limits in 3.053 counties
For 2020, eleven counties will have decreasing, rather than increasing, loan limits due to decreasing median home prices. Both Duchess County and Orange County in NY, NJ, Newark will experience a drop in loan limits from $726,525 to $356,500, a whopping -51%change. The other nine counties to experience decreasing loan limits in 2020 include:
- Lincoln Co in ID – from $646,300 to $331,760 – -49%
- Caroline Co in VA – from $535,900 to $331,760 – -38%
- Hickman Co in TN – from $534,750 to $331,760 – -38%
- Camden Co in NC – from $726,525 to $468,850 – -37%
- Buckingham Co in VA – from $437,000 to $331,780 – -34%
- Hood Co TX – from $395,600 to $331,780 – -16%
- Somervell Co TX – from $395,600 to $331,780 – -16%
- Tyrell Co NC – from $391,000 to $331,780 – -15%
- Sibley Co MN – from $366,850 to $331,780 – -10%
On the other side of the spectrum, loan limits in high-cost areas will increase to a floor of $765,600 in 2020 from $726,525 in 2019.
Three counties in San Francisco-Oakland-Berkeley will see loan limits rise to…
- One bedroom unit – $765,600
- Two bedroom units – $980,325
- Three bedroom units – $1,184,925
- Four bedroom units – $1,472,550
The remaining number of counties that will see loan limits rise in 2020 include…
- 1 county in Los Angeles/Orange county
- 1 county in Santa Cruz-Watsonville
- 1 county in San Jose-Sunnyvale- Santa Clara
- 1 county in Edwards CO
- 2 counties in Glenwood Springs CO
- 2 counties in Jackson WY
- 25 counties in DC-Arlington-Alexandria
- I county in Vineyard Haven MA
- 23 counties in NY-Newark-NJ
- 2 counties in Elizabeth City NC
- 2 counties in Heber UT
Other places in the country will have higher loan limits to account for “higher construction costs.” This loan limit floor will be $1,148,400 in 2020 for Alabama, Hawaii, Guam and the US Virgin Islands.
Thanks to HousingWire’s Kathleen Howley for source data.
Also read: Which Locations Have The Largest Share of Vacation Properties?, Could Student Loan Forgiveness Boost the Economy & Housing?, Top Ten Census Tracts in Opportunity Zones with Median Home Prices +$500,000 or -$200,000