Fannie, Freddie Surge as U.S. Approves $1 Million Loans (1)

Fannie Mae and Freddie Mac climbed after their regulator announced that the mortgage giants will be able to back loans worth nearly $1 million in some of the most expensive U.S. housing markets.

Reflecting the surge in home prices during the Covid-19 pandemic, Fannie and Freddie will be able to buy loans of $970,800 in areas including San Francisco, Los Angeles and New York, the Federal Housing Finance Agency announced Tuesday. The increased loan limits apply to single-family residences.

Shares of Fannie and Freddie both rose about 14% to 99 cents and $1, respectively, in New York trading as of ...