The effect of lower mortgage limits
FHA, Fannie Mae and Freddie Mac all dropped their loan limits in a variety of metro areas across the country as of Oct. 1. Result? Buyers (and would-be refinancers) in the Baltimore region can't borrow more than $494,500 from them. Everything above that amount is in "jumbo" territory with higher rates and -- in some cases -- much higher down payment requirements.
The Baltimore region had temporarily been bumped up to $560,000 in 2008 in reaction to the mortgage meltdown.
The downward push seems to have had an immediate effect on sales between $500,000 to $600,000, which dropped more than 20 percent vs. a year earlier. (Sales between $400,000 and $500,000, meanwhile, rose during the same period.)