The median price of homes in the United States was $ 380,000 in October, up 8.6% from a year ago and 21.8% from 2019, according to a report released last week by Realtor.com.

The increased limits mean more buyers will have access to conventional loans, which typically have down payments and lower interest rates than the jumbo loans available for more expensive properties.

“By increasing the compliant loan limit, I think it will open up more opportunities for buyers who have been excluded,” said Taso Tsakos, managing partner of the agency, based in the East Bay / Sonoma County office. in California. . “It’s also going to benefit the sellers of houses, because… if you have more buyers, you will create more demand, which benefits the sellers and it’s still a sellers’ market. “

This increased demand will likely lead to increased competition and higher prices, according to Jonathan Miller, CEO of New York-based valuation firm Miller Samuel and author of the Douglas Elliman Market Reports for a number of major markets in the United States. United.

The lower interest rates associated with compliant loans “could by definition raise asset prices,” he said.

There is also an ongoing supply problem in the United States, Miller noted. If more potential buyers enter markets that are already suffering from a housing shortage, this will fuel further price increases.

“In the short term, this will be useful for the overpriced people. But in a short period of time, that’s just another stimulus to demand and the problem is supply, ”Miller explained.

In high-cost markets – which include about 100 of the 3,000 counties in the United States, according to the Federal Housing Finance Agency – the change may not make much of a difference.

Take Coronado, California, which includes the second most expensive zip code in San Diego County. There, the increased loan limit of $ 1 million “will probably have very little impact on our market,” according to Scott Aurich of Pacific Sotheby’s International Realty.

“Our average selling price in 2021 to date has been around $ 2.4 million, with the current average listing price above $ 4.7 million,” he said in an e -mail. “Even with low interest rates, many buyers pay everything in cash or borrow through private banking relationships.”

It’s a similar scenario in parts of South Florida, according to Leland Rykse with ONE Sotheby’s International Realty.

“Comparing the statistics since the start of the year, our single-family home market is up about 35% to 40%,” he said. “So a 15% increase in loan limits isn’t going to make a huge dent in that, but it will help some segments. “

Plus, the competition is “already so tight” in South Florida that Rykse said he didn’t think increasing loan limits would mean a warmer market.

“As far as the luxury market is concerned, it probably won’t have a huge impact,” he explained.

“Especially as you sort of go up in price, we always see a lot of cash deals and transactions or even at that price they find alternative funding methods. “

Mansion Global is owned by Dow Jones. Dow Jones and Realtor.com are both owned by News Corp.

This article first appeared on Mansion Global.