Primo areas like San Jose, San Francisco, and New York will keep their limit of $625K, while 39 other counties will see increases of $5.75K-$34.5K.
It might be good news for roughed-up Redwood Trust (RWT +2.1%), which packages non-conforming mortgages. Through the end of September, jumbo mortgages made up nearly 19% of the market, according to Inside Mortgage Finance – up from a low of 5.5% in 2009 and the highest market share since 2006.
The news is also something builders in high-cost areas are going to have to deal with. Moving a community just a little bit can have quite the effect – in San Bernardino County, the $417K cap is in place, but in neighboring L.A. County, the limit moves to $625K.