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The conforming loan limit increased in 2017 for the first time since 2006. Obviously, loans above that limit are jumbo loans, but let’s take a look at these new limits, as detailed in Table 1, so we are all on the same page.
While, 92.7% of all counties adhere to the conforming loan limit, 7.3% have limits that qualify as jumbo loans. So, with those facts in mind, let’s turn our attention to the Top 10 largest markets, captured in Table 2.
These Top 10 MSAs account for over $109 billion in jumbo purchase opportunity. Remarkably, Los Angeles represents over 22% of that total, and has an average loan size of $973,000. Here’s a fun fact: The Jackson, WY MSA, which ranks 90th in terms of dollar opportunity, has the largest average loan size at over $1.6 million.
Now, what happens to the Top 10 when we include our Mortgage Opportunity Index (MOI), which measures the rate of growth of mortgage dollars in a market over the next five years compared to the U.S. Table 3 has our answer.
The point is that California has historically led the way with Jumbo opportunity and 2017 will be no different.