Size limit for government backed mortgages to rise for first time in 11 years

Posted on November 23, 2016

The size of mortgages that are eligible for government backing will increase in 2017 for the first time since 2006, as home prices in the US have recovered to levels last seen before the 2008 financial crisis.

For most of the US, the 2017 loan limit for single unit properties will rise from $417,000 to $424,100. In some higher cost areas, higher loan limits will come into effect.

The 2008 housing and economic recovery act established the baseline limit of $417,000, adding that it could not rise until the average US home price returned to third quarter 2007 levels.

The Federal Housing Finance Agency published data today showing house prices have risen 1.7 per cent higher than the third quarter 2007, allowing the limit to be increased.

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