Eisrael Gomez Realtor - Monterey County Blog

The Office of Federal Housing Enterprise Oversight (OFHEO) announced Tuesday it will keep conforming loan limits at current levels of $417,000 for single-family mortgages in 2008, and also hinted it could lower the limits in 2009 if home prices continue to decline.

The conforming loan limit determines the maximum size of a mortgage that Fannie Mae and Freddie Mac can buy or guarantee. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan, increasing the monthly payment and negatively impacting affordability for households in California.

"At more than $568,000, the median price of a home in California is more than 2.5 times the U.S. median of $221,000, yet California is not recognized by OFHEO as a high-cost state," said C.A.R. President William E. Brown. "California still has the third highest home price in the nation, compared with Hawaii at seventh, and Alaska, which ranks 39th in terms of median home price. Yet Alaska, Hawaii, Guam, and the U.S. Virgin Islands are recognized by OFHEO as high-cost areas."

"Now is the time for the U.S. Senate to pass legislation allowing regional adjustments to Fannie Mae and Freddie Mac loan limits and to modernize FHA loan programs," Brown said. "This critical legislation is a key step to allowing families in California an opportunity to climb the first rung of the homeownership ladder."

To read the OFHEO press release, go to http://www.ofheo.gov/newsroom.aspx?ID=397&q1=1&q2=None .
Article courtesy - California Association of Realtors

There was much talk in the local real estate community that the feds were going to up the limit, at least in high cost states, such as California.  Many veteran Monterey County lenders I had spoken with were expecting the limits to go up.  

Their hopes were that the refinance market would pick up as many homeowners who are above the limit are desperately searching for a way to refinance out of current loans they can't afford.  This may push many more into foreclosure or to seek a short sale.  This would be inventory in addition to the already slow moving units.  There are over 2,700 homes already for sale in Monterey County. 

The great news is when I did a search this morning there were 792 properties that matched the limit. Foreclosure Homes and homes for sale under the $417,000 confirming limit mark in Monterey County:

659 Single Family Homes

133 Condos

So buyer's can still buy at great interest rates at some of the lowest prices in years!

Eisrael Gomez

(831) 809-8266

PS  Many persons are asking about Monterey County foreclosures.  To receive regular updates and lists of foreclosures just email me at egomez@gomezhomes.com.