Great news for consumers this week: Congress passed the loan limit extension to 2010.
What’s in it?
The Metropolitan loan limit ( as in most Bay Area) $729,750 to end of 2010
Conforming loan limit $417,000
Had the Congress not pass this urgent resolution for the national Real Estate market, the outlook for the industry is not good for 2010. Why? As we all know, this past year’s national financial crisis, our Bay Area housing market was one of the limited areas nationally not affected seriously. Our home pricing still stay 30% higher than national level. Most of the stimulus programs, affordability programs and tax credit program do not apply to Bay Area’s home buyers. The middle-leveled market ($727,500 – 1M+) not moving. Activities slow or none.
If the home price not dropping, the loan amount retain at the current level of $625,500 for intermediate conforming and conforming @ $417,000. will not help our market in the Valley. Our mid-ranged market will not move.
The passing of this resolution is also a good sign for the consumers meaning : The pricing will be stabilized in Bay Area. With Fannie Mae and Freddic Mac approved 125% of the housing price, middle and higher bracket home buyers would be more willing to come into the market and start buying, exchange or upgrade.
Tax credit program has also been modified and extended. We’ll find out more as the details revealed soon.
Thanks for the Congrass swift move on this in helping the recovery of the economy.