Conforming Loans in San Mateo County? Very Unlikely!

If you have been in the housing market lately you are keenly aware of what’s going on in lending.  Rates have gone up from the historic lows of a few years ago.  Get past it folks, we will never see 4% interest rates again in our lifetimes.  Where the rates are sitting today, hovering around 6.5% or so, seems high to
many, but historically these rates are considered low when one looks at interest rates over the past twenty years or so.  We are still seeing realitively cheap money for buying a house.

With the high cost of housing here in San Mateo County, the $417,000 conforming Fanny Mae or Freddie Mac loan that is always a little lower in its interest rate is rarely seen around here.  There was a
movement in Congress to try and give high cost housing areas like ours the same break on the conforming loans that Hawaii, Alaska, The Virgin Islands and Guam receive.  They get  a conforming rate at
$625,050.  Since the good folks at Forbes have once again done their update on the highest housing markets in the US recently, Alaska, the Virgin Islands and Guam don’t show up!  So how come they get this break and we don’t?  California does show up with several cities.  Is the Bush administration punishing
California for our high housing prices?  I think so since the Feds are proposing that they leave the conforming loan limit for single-family homes the same it is now through 2008.

The average priced home in San Mateo County in our part of the world (Millbrae, Burlingame, Hillsborough, San Mateo, Foster City, Belmont and San Carlos) was $980,000 and the average condo was $575,000 in
2006.  That’s the reason we don’t see conforming loans very often, whereas the average priced home in the US is in the mid-$200,000′s.  If you have traveled anywhere around this country you have seen how much land there is that is open and available to build upon near many major cities, but alas this isn’t the case here in San Mateo County.  We too have loads of land but it’s mostly in the hands of governments like San Francisco, San Mateo County, the State of California or not suitable to building due to lack of water
such as near the coast, agricultural laws like the Williamson Act, or topography too steep to build on.

What can we do the push our government to change their minds on this?  The Federal housing Finance Board sees housing prices declining.  And they are in many places but not so much around here plus it would take a depression of huge magnitude to cause housing prices to drop that dramatically for us.  If you want to see
change you need to do something about this.  Write our Congressman Tom Lantos. You can write to Congressman Tom Lantos online very easily.  Tell him how you feel about this.  I will.  Who knows, it might do something.