The NYC conforming loan limit that applies to condos for 2021 is $822,375.
A conforming loan limit is the maximum price for which the US government will purchase your loan from your lender. Loans under this limit are conforming loans. Mortgages that exceed the loan limit are jumbo loans.
Why do I want my condo to be below the NYC conforming loan limit?
Home buyers can benefit from taking out a conforming loan, as opposed to a jumbo loan. The main advantage is a lower Annual Percentage Rating (APR). This results in lower fees and interest payments for the home buyer.
In addition, lenders are more likely to give a home buyer a loan if the government will insure it.
Check out Marketproof New Development for the most information anywhere on NYC condos.
Who decides the NYC conforming loan limit?
The Federal Housing Finance Agency sets the limit in accordance with the Housing and Economic Recovery Act. The FHFA regulates Fannie Mae, Freddie Mac, and the 11 other federal home loan banks. These are the institutions that insure your mortgage.
The conforming loan limit rises along with US housing prices. For example, last year’s NYC condo conforming loan limit was $765,600. This tells us that housing prices rose considerably year over year.
What do I do if I can’t qualify?
Do not despair if your condo purchase exceeds the conforming loan limit. You still have options to avoid exceeding the limit.
The most obvious option, if your finances permit, is to leave a big enough down payment to knock the remaining price of the house below the conforming loan limit. For example, if your new one-unit NYC condo is $1,000,000, putting down a payment of $200,000 would put your condo in conforming loan territory.
Another route is to seek a Federal Housing Administration loan on top of a conforming loan. If you are eligible for this, the FHA loan will cover the difference.
How do I find condos for the optimal price?
Finding a new NYC condo is challenging because comprehensive data on new developments is scarce. In addition, even buildings with public listings may only show you a small fraction of the condos they have for sale. The rest are shadow inventory.
Developers retain shadow inventory primarily because scarcity increases the appeal of condos. Sponsors also do this because they prefer to sell cheaper condos before moving onto more expensive units. Typically, the higher the condo is located in a NYC building, the more expensive it is.
Fortunately, Marketproof New Development offers the most complete data anywhere on new NYC condos. It will not only show you shadow inventory, an unparalleled offering, but also high-value and rare data such as comparable condos to the one you’re considering, how many condos have sold in your building, and concessions you can seek to get the right price.
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By using Marketproof New Development, you will be able to search both publicly listed properties and unlisted off-market properties not available on popular listing sites. Marketproof can increase the inventory you see by 9-10x what you may see on other sites.
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Top photo courtesy of 56-leonard-st-10013.