Salt Lake City Real Estate Blog

The Salt Lake high-end housing market recently received a boost, when conforming loan limit went up from $417,000 to $729,750 in Salt Lake County, Tooele County, and Summit County.

This increase means that Fannie Mae and Freddie Mac can now provide loans up to $729,750, which should result in a much-needed boost to the Utah housing market. High-end homes have recently undergone a slowdown, mainly because lenders shutdown the Jumbo Loan market as part of the sub-prime scare. Lenders have since discovered that Jumbo Loans are not the real problem, and are now starting to relax lending requirements. This coupled with the new lending limits should hopefully put some much-needed life into Salt Lake’s high-end real estate market. Many home buyers will now be able to take out a single loan, without the need to take out a jumbo loan, with their high interest rates and down payment requirements.

In addition to Fanny and Freddie raising their limits, FHA loan limits also went up from $364,000 to $729,750, further opening up finance options to home buyers.

To determine how these changes will affect you, we recommend that you seek the advice of a mortgage professional. Alternately, you can post your question here, and we will get a mortgage professional to reply.

Experts are predicting that the slow housing market will continue through the end of the year and well into next year. Fueled by the subprime problem the number of foreclosures are not expected to peak until next year which will put further pressure on the U.S. real estate market. 

The market in Salt Lake is still very healthy at the low end (under $200) but is slower than last year when you get above that level.

Everyone knows about the subprime issue with the market but I believe another problem will start and rear its ugly head. People living beyond their means. This is where people have been living on the equity within their home, every time they need more money they just cash out more of the equity. But what happens when prices don’t go up? All of a sudden that ready made cash is no longer available, but they still have the same level of expenditure.  They could sell their home and downsize in order to cut their bills, but wait their home is already mortgaged to the max and prices have now gone down so they owe more than it is worth. If they cannot cut their bills then the only option is to foreclose!