FHFA Raises 2025 Loan Limits: Boost for California's High-Cost Housing Markets 
The Federal Housing Finance Agency (FHFA) has announced that the conforming loan limit (CLL) for one-unit properties will increase to $806,500 in 2025, marking a 5.2% rise from the 2024 limit. This adjustment reflects the 5.21% increase in average U.S. home values between the third quarters of 2023 and 2024, as indicated by the FHFA House Price Index.

In high-cost areas, where 115% of the local median home value surpasses the baseline CLL, the loan limit will be higher, with a new ceiling of $1,209,750 for one-unit properties. In California's high-cost areas, such as parts of the Bay Area, Los Angeles, and Orange County, the increased conforming loan limit for 2025 will help more homebuyers access government-backed mortgages. The new ceiling of $1,209,750 for one-unit properties allows buyers in these regions to secure financing without resorting to jumbo loans, which often come with higher interest rates and stricter qualification criteria. This adjustment reflects the state's consistently high home prices and provides greater affordability options for those navigating California's competitive real estate market. It is expected to benefit middle-income borrowers, particularly first-time homebuyers, by expanding access to loans under more favorable terms.

These updated loan limits apply to mortgages acquired by Fannie Mae and Freddie Mac in 2025.
You can look up your county’s 2025 loan limit here.

Legal Updates
Register here for the next Legal Live Webinar on the New and Revised Forms taking place on December 10th at 1:30pm. 

The Standard Forms Committee met during the Fall Business meetings and is working through changes to the forms that will be updated in the December release. You can find the December 2024 Forms Redlines here. The forms are expected to be released the week of December 16th.  As a reminder, please send all suggestions for standard forms to [email protected].

Continue to check the Broker Compensation Compliance page on car.org as new updates and information are being added. 

Legislative Update
C.A.R. Makes Its Presence Felt On California Ballot Initiatives
Successful Outcomes CAR has had a very successful year campaigning for and against ballot initiatives, including its own direct campaign efforts and efforts funded by its Issue Mobilization Political Action Committee (IMPAC). Together, C.A.R. and IMPAC funded campaigns in the March and November elections. Those efforts led to victory on state ballot measure contests and on more than 40 local measures.
C.A.R.’s campaign against Proposition 33 through its Homeownership for Families, No on 33 Committee, which was partially funded by IMPAC,was essential to the overwhelming defeat of the measure. C.A.R’s campaign included sending over 12.8 million targeted mailers to California voters, texts and phone calls and a robust member mobilization campaign (read more about the results).

IMPAC also contributed the second largest amount of funds to the successful Yes on Prop 34 campaign, sponsored by the California Apartment Association. This initiative, which would require public health care organizations such as the AIDS Healthcare Foundation (the primary funder of the initiatives to repeal Costa-Hawkins), to spend their funds on their core mission.

At the local level, IMPAC funded many campaigns, several of which were in high-profile contests. All funding came at the request of local Associations of REALTORS® who were very involved. More than two dozen local associations contributed to the campaigns to defeat proposed vacant property taxes in Adelanto and South Lake Tahoe, both of which were defeated. Local IMPAC funding helped local associations defeat proposed rent control measures in Marin County, a parcel tax in National City, and a transfer tax proposal in St. Helena.

Not all campaigns were in opposition. Local IMPAC funds also helped local associations pass a flood control assessment in Stockton that will help avoid steep increases in flood insurance, as well as a school bond in Arcadia and in Rancho Palos Verdes.

These are just a few of the many local ballot measure campaigns in which local IMPAC funding was instrumental.

Recognition of C.A.R’s Effectiveness C.A.R.’s success also caught the attention of other interested parties in California state politics, especially the media. 

A recent article published in the online political news site, Politico, placed C.A.R second on a list of “Seven Players Who Left Their Mark on the Ballot Measure Scene this Year.” C.A.R. is described as having “tanked” Prop 33 and “flexing its muscles on local races across the state.” The profile adds that C.A.R. “helped break political fundraising records” and “tilted the scales” against rent control initiatives in Marin County.

Another article in Politico also references how C.A.R.’s political muscle influenced outcomes. The article entitled, “Gavin’s Ballot Scorecard” credits Governor Gavin Newsom with having “killed rent control in California” with his low-key endorsement of the No on Prop 33 campaign. It states that while Newsom did little to promote his opposition, the work done by the No on Prop 33 campaign amplified that opposition. The article describes how “his face was plastered on ads and mailers advocating for a vote against Proposition 33,” and voters were “seeing him in ads arguing the initiative would roll back Newsom’s achievements in affordable housing.” These ads are largely credited with determining the outcome of the vote against the measure.

While the article does not expressly mention C.A.R., it features a photograph of the C.A.R. mailer touting Newsom’s opposition. C.A.R.’s Homeownership for Families, No on 33 Committee sent 3.3 million copies of that flyer to registered Democratic voters in California.

Further recognition of our efforts came in the form of press that might be perceived as adverse to C.A.R, but in politics that can still be a compliment. For example, the San Francisco editorial, Endorsement: Prop 5 limits affordable housing locations. Vote No , objects to how the negotiations on Proposition 5 between the proponents of the initiative and C.A.R changed the resulting initiative. Those changes protected homes and Proposition 13 and took C.A.R. to a neutral position, but as a result of the changes, the SF Chronicle said it had to oppose Proposition 5. In acknowledging C.A.R.’s role in shaping these outcomes, the editorial also states the obvious – that C.A.R. is a powerful and consequential player in the California political arena.

Market Update 
News on the economy and the housing market last week was mostly positive and encouraging. Black 
Friday kicked off the holiday shopping season and consumers were able to deliver. Retail sales on the day after Thanksgiving increased 3.4% year-over-year and more money is expected to be spent on Cyber Monday. Consumers feeling more confident about the economy and their financial well-being was one reason for the holiday spending spree. The Consumer Confidence index which measures the level of optimism, indeed, increased for the second straight month in November. There was also good news in the housing market, as conforming loan limits were raised for 2025 and mortgage rates continued to recover 
after reaching their recent peak in early November. And while it was disappointing to see new home sales dropping to the lowest level in October, a separate housing market index released recently suggests that an improvement in buyers’ traffic and future sales was observed in November. Read the full weekly report here. 

Key Read of the Week
“The Trump administration's latest push to end government conservatorship of Fannie Mae and Freddie Mac has the housing world abuzz – and for good reason. According to the National Association of Realtors, these government-sponsored enterprises (GSEs) guarantee about 70% of U.S. mortgages. Any alterations to their structure could send shock waves through the housing market, impacting everything from mortgage rates to affordability.” Read the full article from Yahoo Finance here. 

Resources for You and Your Staff

NOW is the Time - RIGHT NOW!
A full package of CE is waiting for C.A.R. Member agents on car.org. They can use that 45CE package or a standalone ETHICS COURSE to renew their NAR Ethics Requirement BEFORE THE END OF THE YEAR. If they have not done so already between January 1, 2022 and today, this class is due NOW. The course automatically records with NAR after it’s passed and that helps keep your agents’ membership active. Have them sign up today!
 
Are You Ready for 2025?
C.A.R. education continues to offer a surplus of classes and titles that your office can use to advance in the new year. Expand by working with First-time Buyers, Seniors, Investors, or get your Transaction Coordinators certified with 17-hour TC programs. Most classes are discounted for C.A.R. members and deals launch all the time. C.A.R. Business Products store has what you need to help your practice grow. 

C.A.R. Speakers for your next event - we created a resource for you to book one of our speakers, access the most recent presentations and find out what topics are available for you and your agents here.

Check out the Broker/Office Manager page containing key information for your success! Please send feedback to us.