The Senate passed an amendment a few weeks ago that increases the limits back to $729,750, and although it will face opposition in the House, it is attached to a government spending bill that needs to be law by November 18th.
That's how these things tend to get pushed through.
Home builders and Realtors alike have been pushing for the reinstatement of these limits, so potential buyers in higher priced markets can get easier, cheaper access to credit. The median price of a newly built home is far higher than that of an existing home. Realtors have blamed a drop in home sales in California recently, where prices are higher than the rest of the nation, on lower the conforming loan limit.