SECTION 2. CHANGES

Average area purchase price safe harbors were last published in Rev. Proc. 94–55, 1994–2 C.B. 716, and were based on housing price estimates calculated by the Department of Housing and Urban Development from mortgage data collected by the Federal Housing Finance Board (FHFB). As more fully described in section 3 below, the average area purchase price safe harbors contained in this revenue procedure are based on the annual loan limits set by the Federal Housing Administration (FHA) on FHA-insured mortgages (FHA loan limits). Because FHA loan limits do not differentiate between new and existing residences, this revenue procedure sets forth a single average area purchase price that may be used as a safe harbor for both new and existing residences in each of the listed statistical areas. This revenue procedure also sets forth a single nationwide average purchase price.

This revenue procedure also reflects the Office of Management and Budget’s (OMB) current definitions for the nation’s metropolitan statistical areas (MSAs), as contained in OMB Bulletin No. 03–04, dated and effective June 6, 2003. The safe harbors provided in Rev. Proc. 94–55 were for MSAs defined in OMB Bulletin No. 93–17, dated and effective June 30, 1993.