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Seattle Gets Higher Conforming Loan Limits for 2018

A couple of months ago, we speculated that the conforming loan limit for Seattle and the rest of King County would go up in 2018 due to significant home price gains. And it’s now official.

Earlier today, federal housing officials announced that the Seattle conforming loan limit for 2018 would increase to $667,000. In most other counties across the state, the limit will rise to $453,100.

Seattle Gets Higher Loan Limits for 2018

On November 28, the Federal Housing Finance Agency (FHFA) announced that most cities across the country would see higher conforming loan limits in 2018. For most of the U.S., the loan limit for a single-family or “one-unit” property will rise from $424,100 to $453,100. That is the new “baseline” conforming loan limit for single-family home purchases in the U.S.

These caps are based on median home values. This means that more expensive real estate markets tend to get higher limits, to coincide with higher home values.

Seattle conforming loan limits are higher than the national baseline mentioned above. In 2017, the conforming limit for a single-family property was $592,250. Starting in 2018, that limit will go up to $667,700. That’s a substantial increase – $74,750 to be exact. This limit applies to the entire Seattle metro area, including the counties of King, Pierce and Snohomish.

This means that the jumbo loan threshold for Seattle metro area (including King, Pierce and Snohomish counties) will increase as well. In 2018, anything that exceeds $667,000 will be considered a jumbo mortgage product.

It’s possible to borrow more than the Seattle conforming loan limit, as long as the borrower’s income supports it. When a home loan exceeds the conforming limit for the county where the home resides, it is referred to as a jumbo mortgage loan. The qualification criteria for jumbo mortgage products can be a bit more strict, due to the larger amount being borrowed.

For most other counties in Washington State, the conforming loan limit for a single-family property will rise from $424,100 (in 2017) to $453,100 in 2018. San Juan County will remain unchanged at $483,000.

On a side note: The Department of Housing and Urban Development will probably announce the new FHA loan limits for 2018 over the coming weeks. They usually make that announcement at the end of December. So stay tuned.

Most Counties in the U.S. Will See an Increase

Most counties across the country will see higher loan limits in 2018, though the increase might not be as large as the one being applied to the Seattle area.

According to an FHFA press release published earlier today: “As a result of generally rising home values … the maximum conforming loan limit will be higher in 2018 in all but 71 counties or county equivalents in the U.S.”

A Response to Rising Home Values

It’s not surprising to see federal housing officials increase the conforming loan limits for the Seattle area. As mentioned above, these limits are based on median home values which can change over time.

Home prices across Washington State rose significantly during 2017. According to Zillow, the median home value for Seattle rose by a whopping 14% over the last 12 months (through October 2017).

To put that number in perspective, home prices across the U.S. tend to rise somewhere between 3% and 5% historically, looking back over the last couple of decades. So the gains in and around Seattle have far surpassed the norm. And that’s why we will see higher conforming loan limits for Seattle and King County in 2018.

Learn more: Our website currently offers FHA, conventional and VA loan limits for all counties in Washington. We will soon update those pages to reflect the increases for 2018.

Need a mortgage loan in Seattle? Sammamish Mortgage is a local, family-owned company based in Bellevue, Washington. We offer a variety of mortgage products including both conforming and jumbo. Please contact us if you have financing questions, or if you would like to receive a rate quote.

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