Federal agency supports more condo mortgages

Business

FILE – In this April 16, 2019, file photo, new condos under construction are being built in vacant lots in a neighborhood near downtown Orlando, Fla. The Federal Housing Administration is changing regulations to make it easier for more first-time condo buyers to receive mortgages. The federal agency released new guidelines Wednesday for the types of mortgages it will insure at condominiums. (AP Photo/John Raoux, File)

This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

WASHINGTON (AP) — The Federal Housing Administration is changing regulations to make it easier for more first-time condo buyers to receive mortgages.

The federal agency released new guidelines Wednesday for the types of mortgages it will insure at condominiums. Just 6.5% of the 150,000 condominium developments in the United States were previously eligible for FHA-backed mortgages. But the FHA will start backing mortgages for individual units and will have greater flexibility to react to changes in market conditions.

Brian Montgomery, the FHA commissioner and acting deputy secretary of the Housing and Urban Development Department, said the changes would make it easier for first-time buyers, retirees and minorities to become homeowners. Unlike conventional mortgages that require 20% down, the FHA backs loans that require 3.5% down payments.

As regulations tightened after the housing crash, the number of FHA mortgages for condos fell from 72,900 in 2010 to 16,200 last year. The rule change is expected to increase the number of FHA mortgages for condos by 20,000 to 60,000 units.

Wider availability of mortgages could increase construction by 7,000 condos, according to an analysis last year by HUD.

It’s unclear just how much the expansion could increase the U.S. home ownership rate, as prices have risen faster than incomes and the inventory of homes on the market have been below historical averages.

Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

CBS47 On Your Side

Do you have a problem that you need help solving? Contact CBS47 and let us be On Your Side.

Phone: 559-761-0383
Email: OnYourSide@cbsfresno.com

Images from Armenia

Small patients in Armenia
Yerevan by night.
Dr. Jeff Thomas delivers.
Dr. Jeff Thomas delivers in Gyumri.
Doctors unpack medical supplies from The Central Valley.
Fresno Medical Mission at work.
Medical Supplies being unloaded.
Fresno Medical Mission at the ready.
KSEE24 crew witnesses the miracle of life in Gyumri, Armenia.
Life saving work of Central Valley surgeons in Armenia.
Ribbon cutting on new surgical center in Ashtarak Armenia. Fresno donors made this dream come true.
KSEE24 on assignment with the Fresno Medical Mission
Honorary Consulate to Armenia Berj Apkarian explains the crisis facing one hospital.
KSEE24's Stefani Booroojian and Kevin Mahan at the meeting with President Bako Sahakyan.
Medical Meeting in Artsakh.
The President of Artsakh meets with the Fresno Medical Mission.
Learning modern medicine techniques with the Fresno Medical Mission in surgery.
Leaning in for a look. Dr. Brien Tonkinson holds class and helps a patient in Armenia.
Fresno Medical Mission cares on one of the smallest patients in the region. Six-year old Yanna receives life-changing better breathing surgery.