David Plunkert

According to Street Scout / AZ Central, the FHA has raised mortgage loan limits so buyers can qualify for more expensive homes. Nationwide home prices are up seven percent as compared to last year and the move is expected to provide a stimulus to the market. The loan limit is going from $294,515 last year to $314,827. Home buyers who take advantage of the program are required to make a down payment of 3.5% and carry mortgage insurance of up to 1 percent of the loan.

Dean Wegner of Scottsdale-based Guardian Mortgage said FHA loan increases often give the housing market a boost, but due to higher home prices the limit needs to increase more in metro Phoenix. Ali Wolf of national housing firm Meyers Research said Phoenix is one of the cities that will benefit the most from higher FHA loan limits.

Metro Phoenix's median existing-home price is about $262,000. The area’s median new home price is about $318,000. He estimates 35 Valley subdivisions are now selling new homes priced below the higher FHA loan limit. Dallas only has about 15 developments selling homes priced in the FHA loan range.

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