Fannie Mae, Freddie Mac and FHA loan limits changes due in October-How will this affect the Florida Real Estate Market?

Fannie Mae and Freddie Mac is slated to cut the size of loans they buy from lenders starting Oct 1, 2011 and the Federal Housing Administration (FHA) loan limits will also drop on the same day.    How will this move affect the Florida real estate market? It will mainly affect high-cost home areas.

Fannie Mae and Freddie Mac- According to HUD, Florida currently has six city areas with a maximum loan limit higher than $417,000 for a one-family home: Fort Lauderdale-Pompano Beach-Deerfield Beach (current maximum loan is $423,750), Miami-Miami Beach ($423,750), Bradenton-Sarasota-Venice ($442,500), West Palm Beach-Boca Raton-Boynton Beach ($423,750), Naples-Marco Island ($531,250), and Key West ($729,750).

Of the six, four will drop to the new maximum of $417,000; however, two will not. Effective Oct. 1, the Fannie Mae and Freddie Mac loan maximum for Naples-Marco Island will be $448,500, while Key West-Marathon will be $529,000.

FHA
FHA limits differ by city yet no area in Florida is lower than $271,050 which is 65 percent of the Fannie Mae/Freddie Mac loan limit.    The FHA national loan limit “ceiling” is 150 percent of the national conforming loan limit. In higher-cost areas, the FHA loan limit lowers after Oct. 1, though not necessarily to the floor amount.

In Jacksonville, for example, the current FHA maximum one-family loan limit of $387,500 drops to $304,750; in Miami-Miami Beach-Kendall it drops from the current $423,750 to $345,000; in Key West it goes from today’s $729,750 to $529,000.  The Orlando area (Orange, Seminole, Osceola and Lake Counties) limit will be $274,850.

Still, since many areas  in  Florida already have a $271,050 FHA loan limit – mainly smaller urban areas –buyers in those areas will not notice a difference.

How will your area be affected? You can search the new limits here on the U.S. Department of Housing and Urban Development's searchable database for loan limits, both FHA and Fannie Mae/Freddie Mac.

Want to see homes for sale in the Orlando area? See all the Orlando MLS listings here with no registration.

Three Year History of Average Monthly Mortgage Rate-Orlando

Buyers who purchased an Orlando home in August are paying the lowest average interest rate – 4.26 percent – since the Orlando Regional REALTOR® Association began tracking the statistic in January of 1995. The record was previously held by October 2010, when the average interest rate stood at 4.28.

Orlando-Real Estate Market Report

Buyers who purchased an Orlando home in August are paying the lowest average interest rate – 4.26 percent – since the Orlando Regional REALTOR® Association began tracking the statistic in January of 1995. The record was previously held by October 2010, when the average interest rate stood at 4.28.

The following charts provide a comprehensive view of the real estate market in the greater Orlando area. This area includes Orange, Seminol, Osceola and Lake counties and includes the following towns and cities: Orlando,Winter Park, Lake Mary, Sandford, Winderemere, Winter Springs, Longwood, Maitland, Oviedo, Kissimmee, St Cloud, Winter Garden, Apopka, Clermont, Altamonte Springs and more.

The following two charts show total market inventory of homes listed in the Mid-Florida MLS for the past three years, on a monthly basis. Inventory has decreased by 6,480 properties for the  month of August 2011, compared to August 2010. This represents a drop of 39% of inventory of homes available for sale in the Orlando area since last year.

Selling your home in Lake Mary- MLS vs Non-MLS sales

How do MLS and Non-MLS sales for homes compare in Lake Mary, Florida?

Sales in Lake Mary-32746 for the past 2 Years, MLS vs. NON-MLS Sales

	Sold Listings			Non-MLS Sold Properties
Month	Count	Median Price	DOM	Count	Median Price
8/2009	66	$185,000	90	10	$115,740
9/2009	57	$190,000	102	28	$133,500
10/2009	58	$189,250	91	39	$290,000
11/2009	65	$193,000	95	50	$279,250
12/2009	74	$195,000	100	49	$246,500
1/2010	47	$151,000	94	25	$300,000
2/2010	43	$156,950	98	28	$243,500
3/2010	69	$169,900	115	45	$245,000
4/2010	71	$142,500	77	44	$245,750
5/2010	69	$140,000	84	30	$294,450
6/2010	82	$169,000	106	49	$259,900
7/2010	77	$140,000	90	39	$239,500
8/2010	63	$135,000	109	39	$265,000
9/2010	49	$169,995	101	16	$227,600
10/2010	44	$196,500	124	8	$198,300
11/2010	46	$159,950	126	6	$172,500
12/2010	52	$163,450	141	7	$125,000
1/2011	45	$134,900	114	4	$211,000
2/2011	39	$106,000	137	7	$75,000
3/2011	41	$200,000	93	11	$121,000
4/2011	54	$206,100	124	8	$170,000
5/2011	61	$187,500	133	3	$115,000
6/2011	54	$152,500	132	11	$172,500
7/2011	67	$194,000	115	2	$24,000

Notes:
DOM: Median Days On Market

Magnolia Plantation- Lake Mary, Homes for Sale.

There are 17 Current homes listed for Sale in Lake Mary's neighborhood of Magnolia Plantation on the Mid-Florida MLS.  The median single family home has five bedrooms and four baths with 3,835 sq/ft and a median price of $515,000. The median list price per square feet is $161.60/sqft.  You can download a PDF list of the current homes for sale in Magnolia Plantation here or see all of the Lake Mary listings with pictures.

Market Statistics for Current Homes for Sale in Magnolia Plantation

Beds Full Baths Sq Ft Heated List Price LP/SqFt High 6 7 6,002 $1,645,000 $332.32 Low 4 3 2,368 $364,900 $126.54 Average 5 4 4,098 $713,847 $168.83 Median 5 4 3,835 $515,000 $161.6

Lowest Mortgage Rates in 60 years

Fixed mortgage rates fell this week to the lowest levels in six decades. The average rate for the 30-year fixed mortgage fell to 4.12 percent, down from 4.22 percent, according to Freddie Mac. The average rate on a 15-year fixed mortgage, a popular refinancing option, fell to 3.33 percent from 3.39 percent. But few Americans can take advantage of the rates to refinance or buy a home. Here is why.

Rental Market Offers Investment Opportunities

The rental market is continuing to offer real estate investment opportunities that may offer good returns for buyers willing to jump into the landlord role. According to Money Magazine's September 2nd issue of 2011, nearly 35 percent of occupied homes were rented in 2010, which is a 33.8 percent increase from 2000. Rents are rising and demand is up too, partly to the 4 million former homeowners who’ve faced a foreclosure and are now renters.  Nationwide, rents have increased 11.6 percent in 2010 to an average of $1,320 a month, according to Hotpads.com. Record low mortgage rates and general discounts on home prices means that opportunities can be found.

What to look for? Single family homes with 3 bedrooms and 2 baths in neighborhoods with good schools and close to transportation is a smart choice. Buying property close to you permanent residence is a good idea. When determining if the  numbers will work, make sure your rental income covers  the mortgage payments on the property as well as an extra 20 percent buffer to cover repairs, property management or get through vacancy periods. Consider holding your real estate investment for a while.  According to a survey by the National Association of Realtors®, investors plan to keep their real estate investments for 10 years, on average, before selling.

To view what homes for sale in the Orlando area click here.