More than 28,590 families in California will be able to benefit from Fannie Mae’s and Freddie Mac’s recent announcements that each will increase it’s single-family mortgage loan limit from $359,650 to $417,000 in 2006, according to an analysis by C.A.R.

While I’m sure many will be pleased by this, the new conforming loan limits are not sufficient to benefit most homebuyers in Southern California. Conforming loan limits come far from accurately reflecting the California housing market, where the median price of a home is more than double that of anywhere else in the country.

The current median home price in California is $538,770, nearly 30% higher than the national conforming loan limit of $417,000, with 19 counties in the state recording a median home price above the national conforming loan limit.