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Fannie Mae has sent lenders an advanced notice that additional risk criteria is coming for loans it acquires from lenders.
While not every investor raised their pricing adjustments immediately after Fannie's announcement, most eventually will, as they seek to avoid closing second home/investment loans they can't be certain Fannie/Freddie will purchase (due to the new 7% cap announced).
Note, these are just the NEW investor pricing adjustments based on Fannie's announcement and substantial others still apply based on credit scores, loan purpose, property type, equity, etc. As a reminder, Fannie/Freddie also added a .5% cost to all refinances over $125,000 last fall as the pandemic increased defaults and forbearances.
The impact for certain housing markets (such as FL condos, which historically have large percentages of second homes/investment ownership) can't be overstated. If you've been considering buying a second home, it's critical you contact your lender immediately to discuss how this announcement will affect your loan's rates and costs.
Fortunately, loans in process that are already locked will not be subject to the new adjustments, but floating loans almost certainly will be.
Bottom line: Demand for second homes and investment properties will be greatly impacted by Fannie's policy. Expect to see far more cash buyers for these situations, and (more than likely) far fewer bidding wars as the new pricing adjustments raise rates and costs. Outside investors may eventually purchase more of these loans (which is FHFA's goal), but for the moment, prepare to pay substantially higher costs for a loan or pay cash for that getaway condo or rental property!