Realtors Want Permanent Increase to National Conforming Loan Limit
A temporary increase to the conforming loan limit in some high cost areas is no longer enough for the National Association of Realtors. In testimony today before the Committee on Banking, Housing and Urban Affairs, NAR's public policy chair Vinca Malta said that Congress needed to permanently raise the GSE conforming loan limits to $625,000 across the board, with an additional increase of 125 percent of the local median home-sales price in high-cost areas. "We believe this move will boost the housing market and the economy by bolstering home buyer confidence and bringing families back into the marketplace," said Malta, himself a realtor. "That would increase home sales by nearly 350,000, lower inventories and increase home prices by two to three percent. It would also result in as many as 210,000 fewer foreclosures, and more than 500,000 borrowers would be able to refinance into lower interest rate loans." The NAR's latest lobbying effort comes on the heels of strong praise from the realtor-led organization for a recently-passed economic stimulus measure, which temporarily boosts FHA and conforming loan limits to as much as $750,000 in certain high-cost areas. Both the realtors and the National Association of Home Builders, who also testified to Congress Thursday, recommended that the Senate pass H.R. 1427, the Federal Housing Finance Reform Act of 2007. The bill was passed by the House in May of last year, and would establish a new regulator for Fannie Mae and Freddie Mac to replace the Office of Federal Housing Enterprise Oversight. "OFHEO is constraining the ability of Fannie and Freddie to do all they can to promote affordable housing and to help strapped borrowers," said Jerry Howard, CEO of the NHAB. "At the same time, HUD's mission oversight over the two GSEs is lacking. HUD should be requiring them to do more, not less, in the present dire mortgage market circumstances," he said.