A brief excerpt:
With house prices up mid-single digits over the last year, an interesting question is: How much will the Fannie & Freddie conforming loan limits (CLL) change for 2025? And how much will the FHA insured loan limits change?
First, there are different loan limits for various geographical areas. There are also different loan limits depending on the number of units (from 1 to 4 units). For example, currently the CLL is $766,550 for one-unit properties in low-cost areas. For high-cost areas like Los Angeles County, the CLL is $1,149,825 for one-unit properties (50% higher than the baseline CLL).
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This graph shows the CLL since 1979. The CLL was unchanged from 2006 though 2016.
We need the house price data through September 2024 to calculate the conforming loan limit for 2025. This quarterly data will be released in late November.
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Based on the current year-over-year house price change (through May), the CLL would be close to $810,000 in 2025. For high-cost areas like Los Angeles, the limit could increase to over $1.2 million. However, the year-over-year (YoY) increase in house prices has been slowing, and it is likely the increase will be less than 5.7%.
There is much more in the article.