“The Federal Housing Finance Agency shares the administration's view that a gradual reduction in loan limits is an appropriate and effective approach to reducing taxpayers' mortgage risk exposure, shrinking the footprint of Fannie Mae and Freddie Mac in the marketplace, and expanding the role of private capital in mortgage finance,” Dunkle said in response to a media inquiry.

“FHFA has been analyzing approaches for reducing Fannie Mae and Freddie Mac loan limits across the country, and any such change would be announced with adequate advance notice for implementation on Jan. 1, 2014,” she said.

Fannie and Freddie loans in high-priced markets used to be even higher, jumping up in 2008 to $729,750 as regulators sought to support the trembling real estate market but then moving down again to $625,500 in October 2011, although the Federal Housing Administration will still insure housing finance loans up to the previous high cap.

If the FHFA follows through, the limit change could come as the secondary market for loans too large for Fannie or Freddie – so called jumbo loans – is still recovering from the impacts of the housing finance crisis.