Key Details:
- The Federal Housing Finance Agency (FHFA) announced new conforming loan limits for 2024.
- The baseline limit for the majority of the United States will be $766,550, with a ceiling loan limit of $1,149,825 in high cost areas.
The Federal Housing Finance Agency (FHFA) announced new conforming loan limit values (CLLs) for 2024. These CLLs are for government-backed mortgages acquired by Fannie Mae and Freddie Mac.
The Housing and Economic Recovery Act (HERA) requires changes in the baseline CLLs on a yearly basis, which are calculated based on changes in the average U.S. home price. The latest FHFA House Price Index indicates a 5.56% increase in home prices over the last four quarters. In turn, the baseline CLLs will increase by the same percentage.
National Baseline Loan Limits Hit $766,550
In the majority of the United States, the CLL value for single-family properties will be $766,550 in 2024, marking an increase of $40,350 from the previous year.
According to mortgage banker Brian Skelly, “This now means we will be able to do 5% down on homes up to $806,894, or 3% down for first-time home buyers on a home up to $790,257 with a standard Fannie Mae/Freddie Mac conventional loan.”
While the increase is significant, it is not as big of a jump as the one we saw last year. In 2023, CLL values increased by 12.21%. This, of course, was because home prices in 2022 increased by a higher percentage than they have this year. In addition, loans from Fannie Mae and Freddie Mac back mortgages as high as $1 million for the first time ever in 2023.
Loan Limits for High-Cost Areas
High cost areas, in which 115% of the local median home value exceeds the baseline conforming loan limit value, the loan limit will be higher. These areas have a limit caculated as a multiple of the median home value in the area, with a ceiling at 150% above the national baseline.
This makes the new ceiling loan limit for one-unit properties $1,149,825, starting in 2024.
For a complete list of U.S. county loan limits, click here.
