Condo owners can rejoice, and buyers looking to purchase a condo using an FHA loan can finally explore a few more options in Downtown Raleigh or other area of the Triangle. The new rule allows for several things, but most important in my mind are:
A quick review of 2018 condo sales in the core of Downtown Raleigh shows only 1 FHA financed sale at Palladium Plaza. It will be interesting to see how this new rule impacts sales moving forward because almost half of the condos sold in Downtown were within the FHA range.
Overall, this is a very positive move that should help condos become attractive options for buyers. The strict limits in the old days of 25-35% investors definitely hurt a few buildings downtown and we witnessed some serious damage to values as a result of sellers "giving away" their homes to cash buyers, who were usually investors, which only made the problem worse. The move to 50% helped back then, and this further expansion will open the door to more buyers.
HUGE DISCLAIMER - Financing is already pretty difficult to talk about because of how tied it is to your situation and every detail matters. Surely this rule has small print as well, so always check with your lender to see how this rule applies to your situation.