(Bloomberg) -- The federal government will back mortgages of more than $1 million in additional areas, including San Diego and Breckenridge, Colorado, as US home prices reach records.
The ceiling for government backing on mortgages on single-family homes in the highest-cost areas will increase to nearly $1.15 million in 2024, according to a Tuesday announcement by the Federal Housing Finance Agency. That limit, the maximum for a loan to be bought by Fannie Mae and Freddie Mac, is up from about $1.09 million this year.
For the rest of the country, the limit for loans to be purchased by the mortgage giants will climb to $766,550 from $726,200 this year.
High-cost cities, such as New York and San Francisco, are eligible for the maximum. San Diego County’s limit will rise to nearly $1.01 million from this year’s limit of $977,500. Summit County, Colorado — home to the ski town of Breckenridge — and Routt County, Colorado — home to Steamboat Springs — will both see their limits cross $1 million this year, too.
Home prices in the US hit a record in September, climbing for eight months straight, according to seasonally adjusted data released Tuesday from S&P CoreLogic Case-Shiller. Tight inventory has helped prop up prices in many cities, including New York.
Fannie and Freddie don’t make mortgages. They buy them from lenders, bundle them into securities and guarantee investors that they will be paid. The federal government took control of the companies during the 2008 financial crisis, and the companies have the implied backing of the US Treasury.
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