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TH E M R EP O RT | 59 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST GOVERNMENT Baseline 2023 Conforming Loan Limit Rises to $726,200 In most of the U.S., the 2023 CLL value for one-unit properties will be $726,200, an increase of $79,000 from $647,200 in 2022. T he Federal Housing Finance Agency (FHFA) has announced the conforming loan limit values (CLLs) for mortgages to be acquired by the government-spon- sored enterprises (GSEs)—Fannie Mae and Freddie Mac—in 2023. In most of the U.S., the 2023 CLL value for one-unit properties will be $726,200, an increase of $79,000 from $647,200 in 2022. The Housing and Economic Recovery Act (HERA) requires that the baseline CLL for the GSEs be adjusted annually to reflect the change in the average U.S. home price. The FHFA also published its Q 3 2022 FHFA House Price Index (FHFA HPI) report, which includes statistics for the increase in the average U.S. home value over the last four quarters. U.S. house prices rose 12.4% from Q 3 2021 to Q 3 2022, according to the FHFA HPI. House prices were up just 0.1% compared to Q2 2022. FHFA's seasonally adjusted monthly index for September was up 0.1% from August. Therefore, the baseline CLL in 2023 will increase by the same percentage. "House prices were flat for Q 3, but continued to remain above levels from a year ago," said William Doerner, Ph.D., Supervisory Economist in FHFA's Division of Research and Statistics. "The rate of U.S. house price growth has substantially decelerated. This deceleration is widespread with about one-third of all states and metropolitan statistical areas registering annual growth below 10%." The FHFA reports that in areas where 115% of the local median home value exceeds the baseline conforming loan limit, the applicable loan limit will be higher than the baseline loan limit. HERA estab- lishes the high-cost area limit in those areas as a multiple of the area median home value while setting the ceiling at 150% of the baseline limit. Median home values generally increased in high-cost areas in 2022, which increased their CLL. The new ceiling loan limit for one-unit properties will be $1,089,300, which is 150% of $726,200. Special statutory provisions establish different loan limits for Alaska, Hawaii, Guam, and the U.S. Virgin Islands, and in these areas, the baseline loan limit will be $1,089,300 for one-unit proper- ties. annual appreciation were: 1) Florida 22.7%; 2) South Carolina 18.4%; 3) Tennessee 17.9%; 4) North Carolina 17.4%; and 5) Georgia 16.7%. The areas showing the lowest annual appreciation were: 1) District of Columbia 1.8%; 2) Oregon 7.6%; 3) California 7.6%; 4) Minnesota 7.7%; and 5) Louisiana 8.3%. • House prices rose in all but two of the top 100 largest metropolitan areas over the last four quarters. The annual price increase was greatest in North Port-Sarasota-Bradenton, Florida, where prices increased by 29.2%. Two metropolitan areas that ex- perienced price declines are San Francisco-San Mateo-Redwood City, California; and Oakland- Berkeley-Livermore, California, where prices decreased by 4.3% and 0.6%, respectively. • Of the nine census divisions, the South Atlantic division re- corded the strongest four-quar- ter appreciation, posting a 17% gain between the third quarters of 2021 and 2022. Annual house price appreciation was weakest in the Pacific division, where prices rose by 8.3% between the third quarters of 2021 and 2022. The rate of U.S. house price growth has substantially decelerated. This deceleration is widespread with about one-third of all states and metropolitan statistical areas registering annual growth below 10%.