Conforming loan limits go up for 2019 as home prices keep rising

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The sustained rise in home values will boost Fannie Mae and Freddie Mac's loan limits to $484,350 in 2019, marking the second consecutive year in which it increased by nearly 7%.

The increase in the one-unit limit from $453,100 in 2018 was based on a slightly higher rise in U.S. home prices this year, according to the Federal Housing Finance Agency. The FHFA is the two government-sponsored enterprises' regulator and conservator.

The average seasonally adjusted home price tracked by the FHFA's expanded-data home-price index rose 6.9% between the third quarter of 2017 and the third quarter of 2018. A year earlier, the equivalent 12-month rise in the average seasonally adjusted home price was 6.8%, according to the FHFA.

While the $484,350 limit will be the baseline for most one-unit properties, the maximum will be higher in certain counties and county equivalents. In those areas, the maximum amount will be $726,525, or 150% of the baseline limit, up from $679,650 in 2018.

To obtain a limit above the national baseline, 115% of the local median home price must be higher than the national baseline loan limit.

The baseline loan limits for the two states and two U.S. territories that have special statutory authority (Alaska, Hawaii, Guam and the U.S. Virgin Islands) will be $725,525, up from $679,650. Limits are 50% higher in these areas.

Fannie Mae and Freddie Mac's loan limits are adjusted yearly to fulfill the legislative mandates of the Housing and Economic Recovery Act.

The Federal Housing Administration will set its own loan limits for 2019. These are still pending.

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Home prices Purchasing power GSEs Originations Mortgage rates Fannie Mae Freddie Mac FHFA