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The federal government released its long awaited plan for Freddie Mac and Fannie Mae today, where it announced that it plans to wind down the two companies by slowly increasing their guarantee fees, reducing the maximum amount of money that they can lend on a home, and selling off their existing loans at a rate of about 10% per year.  These changes, combined with increasing interest rates, are expected to have a negative impact on housing prices, so here is a look at a few high end markets that could see the greatest impact from the end of Fannie and Freddie:

Maui: Maui’s real estate market is still recovering from a decade long bubble as housing prices continue to decline, and are expected to show further weakness throughout 2011.  There is hope for an improvement in the Maui real estate market in 2012, but average home prices that are significantly above the national average, continued weakness in the tourism sector, and the large number of vacation homes in the market could continue to hold prices down.

Manhattan: Home prices in Manhattan appear to be stabilizing and even improving as condo prices increased between 7.5% and 14% in the third quarter of 2010 compared to the previous year.  This gain was attributed to the rebound in the financial services market, which added jobs over the last year and saw the stock market continue to post gains, but high prices and tighter lending standards are expected to keep prices from rising too quickly.

Washington DC: Home sales in the nation’s capital showed a strong gain in January, with sales volume up 31% over a year ago, and home prices up 7.5% compared to January 2010.  Despite having some of the most expensive housing in the country, Washington area home sales have continued to show strength as the area’s economy remains strong.

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