Fannie Mae, Freddie Mac announce revisions to condo insurance standards Updates include investor concentration limits, a limited review process, and expanded waivers of project review

Here’s a clear breakdown of what’s actually happening with the new Fannie Mae / Freddie Mac condo insurance + project review changes (March 2026) and what it really means:🧩 Big PictureThese updates from the Federal Housing Finance Agency (FHFA) are aimed at:Lowering insurance costsMaking more condos eligible for financingAddressing the insurance crisis (especially in states like Florida)👉 Net effect: More condos will qualify for conventional loans again and monthly payments may improve.🔑 Key Changes Explained1. 🏢 Investor concentration limits — REMOVEDPreviously: ~50% cap on investor-owned units in many casesNow: That limit is eliminated (for full reviews)👉 Impact:Easier financing in investor-heavy condosOpens up deals that were previously declined2. 📋 Limited review process — ELIMINATEDThe old “limited review” shortcut is going awayReplaced by:Full review ORWaiver of project review👉 Impact:More documentation required in many dealsCould slow some transactionsBUT improves risk oversight of condo projects3. 🧾 Expanded waiver of project reviewNow applies to projects with up to 10 units (previously smaller scope)👉 Impact:Huge win for:Small condo buildingsNon-warrantable deals that can now pass4. 🏝️ Florida-specific rule — REMOVEDNo more mandatory PERS review for new attached condo projects in Florida👉 Impact:Speeds up approvals in FloridaBig deal for your local market5. 🛡️ Insurance changes (THIS is the headline driver)Roof coverage flexibilityNow allowed:Actual Cash Value (ACV) on roofsStill required:Replacement Cost Value (RCV) on rest of property👉 Translation:Roof doesn’t have to be insured “brand new”This dramatically lowers premiumsOther insurance simplificationsRemoved strict replacement cost documentation rulesDropped inflation guard requirementSimplified deductible rules👉 Impact:More HOAs can complyFewer deals were killed over insurance technicalities6. 💰 Stronger reserve requirements (important hidden change)Reserve funding requirement increasing:From 10% → 15% (effective 2027)👉 Impact:Better long-term condo stabilityBUT:Higher HOA dues likelyMore scrutiny on associations⚖️ What This Means in the Real World👍 PositivesMore condos become financeableLower insurance costs → lower monthly paymentsFewer “non-warrantable” deal killersBig relief in high-cost insurance markets (like Florida)⚠️ Trade-offsMore full reviews = more paperworkHOAs face:Higher reserve requirementsMore financial scrutinytune in and learn https://www.ddamortgage.com/blogDidier Malagies NMLS #212566dda mortgage nmls#324329 Support the show