(Adds context on banking regulators’ reason for the new threshold)
By Katanga Johnson
WASHINGTON, Dec 4 (Reuters) - Residential real estate transactions under $400,000 would no longer require an appraisal under a proposal announced on Tuesday by U.S. banking regulators.
The Federal Reserve Board said the current threshold for appraisals of $250,000 has not been raised since 1994, as it proposed the rule in conjunction with the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency. The regulators are seeking public comment on the change.
Real estate transactions that fall below the new threshold would be subject to a “less burdensome” evaluation, a move the regulators said they made in response to industry comment on adjusting threshold for price appreciation. (Reporting by Katanga Johnson; editing by Chizu Nomiyama and Grant McCool)