FHFA Increases Conforming Loan Limit Values for Fannie Mae, Freddie Mac for 2025; Reports Home Prices Rose 4.3% in Third Quarter

WASHINGTON— The Federal Housing Finance Agency announced on Nov. 26 the conforming loan limit values for mortgages acquired by Fannie Mae and Freddie Mac (the Enterprises) in 2025. In most of the United States, the 2025 CLL value for one-unit properties will be $806,500, an increase of $39,950 (or 5.2%) from 2024.

For areas in which 115% of the local median home value exceeds the baseline conforming loan limit value, the applicable loan limit will be higher than the baseline loan limit.  HERA establishes the high-cost area limit in those areas as a multiple of the area median home value while setting the ceiling at 150% of the baseline limit.  Median home values generally increased in high-cost areas in 2024, which increased their CLL values.  The new ceiling loan limit for one-unit properties will be $1,209,750, which is 150% of $806,500.

Most of the counties in the HGAR market area are considered “high-cost areas” by the FHFA.

The 2025 conforming loan limit values for the HGAR market area will be:

Bronx: $1,209,750
New York County (Manhattan) $1,209,750
Orange County: $806,500
Putnam County: $1,209,750
Rockland County: $1,209,750
Sullivan County: $806,500
Westchester County: $1,209,750

The Housing and Economic Recovery Act requires FHFA to adjust the Enterprises’ baseline CLL value each year to reflect the change in the average U.S. home price. On Nov. 26, FHFA published its third quarter 2024 FHFA House Price Index (FHFA HPI) report, which includes statistics for the increase in the average U.S. home value over the last four quarters.  According to the nominal, seasonally adjusted, expanded-data FHFA HPI, house prices increased 5.21%, on average, between the third quarters of 2023 and 2024. Therefore, the baseline CLL in 2025 will increase by the same percentage.

Special statutory provisions establish different loan limits for Alaska, Hawaii, Guam, and the U.S. Virgin Islands.  In these areas, the baseline loan limits will be $1,209,750 for one-unit properties. 

Due to rising home values, the CLL values will be higher in all but six U.S. counties or county equivalents.

U.S. House Prices Rise 4.3% over the Prior Year

U.S. house prices rose 4.3% between the third quarter of 2023 and the third quarter of 2024, according to the Federal Housing Finance Agency (FHFA) House Price Index. House prices were up 0.7% compared to the second quarter of 2024. FHFA’s seasonally adjusted monthly index for September was up 0.7% from August.

“U.S. house price growth slowed in the third quarter, continuing a trend that started in the fourth quarter of the previous year,” said Dr. Anju Vajja, Deputy Director for FHFA’s Division of Research and Statistics. “While house prices continued to increase because housing demand outpaced the locked-in housing supply, elevated house prices and mortgage rates likely contributed to the slowdown in price growth.”

View a highlights video of the FHFA report at https://youtu.be/ed8iYKyWco4

Significant Findings

Nationally, the U.S. housing market has experienced positive annual appreciation each quarter since the start of 2012.

• House prices rose in 49 states between the third quarter of 2023 and the third quarter of 2024. The five states with the highest annual appreciation were 1) Hawaii, 10.4%; 2) Delaware, 8.5%; 3) Rhode Island, 8.4%; 4) Connecticut, 8.2%; and 5) New Jersey, 8.1%. House prices declined in the District of Columbia and Louisiana by 3.1% and 0.4%, respectively.
• House prices rose in 91 of the 100 largest metropolitan areas over the previous four quarters. The annual price increase was the greatest in Miami-Miami Beach-Kendall, FL at 10.8%. The metropolitan area that experienced the most significant price decline was North Port-Sarasota-Bradenton, FL at 6.4%
• All nine census divisions had positive house price changes year-over-year. The East North Central division recorded the strongest appreciation, posting a 6.8% increase from the third quarter of 2023 to the third quarter of 2024. The West South Central division recorded the smallest four-quarter appreciation, at 1.6%.