The NY Times article uses Monterey/Carmel, CA as an example of what will happen to the housing market when their conforming limit is reduced to $483,000. This new limit is MUCH lower because Salinas and surrounds (farming communites) are included in this housing area, dragging the sold comps down.
In the article, an older home in Monterey is pictured as currently listed for $820K. A flight attendant who recently purchased a house in Monterey is quoted as saying he recently bought there using a low-downpayment program and would not be able to buy there under the proposed new conforming limit. I wonder why a flight attendant would want to live so far from a major airport?
Last time I looked (a few mos ago), Monterey was a “retirement town” and had a nearby Navy installation “Pt. Mugu,” but little other industry and jobs. The Navy provides housing for its families stationed there. Persons who purchase in Monterey/Carmel would likely be retired and even have access to private planes. I don’t understand why its residents feel entitled to have the conforming limit remain at $729K. Why should the rest of the taxpayers bail out Fannie/Freddie when they are making RE loan guarantees to persons who voluntarily purchase in resort communities and other upper-tier communities?
I would be interested to know the percentage of property purchases in Monterey/Carmel which are all-cash sales.
