Cisneros Calls for FHA Loan Limit Hike

Former Housing Secretary Henry Cisneros has called for raising Federal Housing Administration loanlimits even higher than the ceiling on loans that can be purchased by Fannie Mae and Freddie Mac. In expensive markets like California and New York, the current FHA ceiling isn't high enough to allowwould-be homebuyers to purchase a median-priced house, Mr. Cisneros told the National Association of Real EstateEditors conference. Government-insured loans "can't help people move into homeownership if they can't usethem," the former secretary of the Department of Housing and Urban Development said. He said local electedofficials "must be more open to higher-density" housing because land is too expensive for low-densitydevelopment, noting that it has become "so much easier to build" in the suburbs than on infill sites.Mr. Cisneros also called for the elimination of redundant closing costs, the creation of homeownership zones, andthe provision of incentives for local authorities to establish trust funds to attract the middle class back tourban centers. Mr. Cisneros, who served at HUD under President Bill Clinton from 1993 to 1997, is now head of AmericanCity Vista, a venture with K&B Homes to build infill housing in America's cities.