By S.E. Slack
Get your guitar, start improvising and have faith your songwriting skills will be enough to afford that dream mansion near Music Row because the government isn’t going to give you much help. The Department of Housing and Urban Development has implemented new FHA single-family loan limits, which means home loans are going to be tougher to get in some areas.
“Implementing lower loan limits is an important and appropriate step as private capital returns to portions of the market and enables FHA to concentrate on those borrowers that are still underserved,” said FHA Commissioner Carol Galante.
The current standard loan limit for areas where housing costs are relatively low remains unchanged at $271,050. The new national-ceiling loan limit for the very highest-cost areas, however, has been reduced from $729,750 to $625,500. Galante said the new limits impact 650 counties across the nation.
In Chicago, the median home value is $166,000 although median sales prices are about $267,300, an increase of more than 15 percent from a year ago. It tends to be less expensive for home buyers than Riverside, where home values are averaging $344,500 and sales prices are averaging $394,500. North Riverside homes, however, are valued at $177,500 with median sale prices coming in a $169,231.
Across Cook County, the average home value is $169,500, a year-over-year increase of 6.1 percent. The median sales price is $232,250. Real estate firm Zillow is forecasting a slight downward trend for the county through October 2014 of less than half a percent.
Homes are spending an average of 119 days for sale on Zillow’s site and almost 40 percent sold below the listing price. More than 36 percent of home sellers cut the price on their listings over the last year. Nearly 37 percent of homeowners in the county have negative equity and more than 9 percent are delinquent on their mortgages.