Our esteemed President has signed the Housing and Economic Recovery Act of 2008 into law. Since I know you can read about the details of this law ad nauseum, I will simply summarize what this means for San Francisco home owners and home buyers.
FHA, Fannie Mae and Freddie Mac loan limits have been permanently increased. For us in San Francisco, we should have the highest loan limits, or $625,500.
This means that more home buyers will qualify for government-backed mortgages and with lower down payments.
For example, I recently helped a couple purchase a really cute single family home in the Ingleside area of San Francisco. They were able to purchase a home with 5% down payment, using a FHA home loan program.
The loans are safe, secure, with long-term fixed rates and allow 1st time home buyers to take advantage of this more even local market.
Keep in mind that this change does not go into effect until AFTER the short-term plan expires. Right now, the loan limit is actually higher. It’s $729,750 but this will expire on December 31, 2008.
If you want to take advantage of the higher conforming loan limits, DO IT NOW! A conforming loan limit of $729,750 will get you into a really nice home in San Francisco. The deals are out there and the savvy will take advantage of the timing.
We now know, 2-3 years later, that the top of the market was in 2005. We are near or at the bottom and won’t know for sure until it’s long gone.
Seize the day.
*Blogger’s note: I used to watch Dead Poet’s Society every summer just before the start of the new school year to get inspired. Yes, I know this both dates and embarrasses me. Oh well!