Are you planning to use an FHA loan to buy a home in the Portland, Oregon? If so, there’s an important number you should know about: $368,000. That’s the current (2016) FHA loan limit for a single-family home in the Portland metro area.
Here’s another number that might interest you: $387,000. That’s the median sales price for homes sold in Portland recently. It’s an average of the median sales figures provided by Zillow and Trulia, as of September 2016.
So the 2016 FHA loan limit for Portland is now lower than the median selling price in the area. This is the result of the tremendous home-price gains the metro area has experienced over the last year or so.
2016 FHA Loan Limits for Portland, Oregon
FHA loan limits are established by the Department of Housing and Urban Development (HUD), and they usually follow the conforming limits set by the Federal Housing Finance Agency. HUD limits the size of the mortgage loans they are willing to insure, which in turn impacts borrowers who use this program to buy a house.
FHA limits vary by county, and they’re generally the same across metro areas. So all cities within the Portland, Oregon metropolitan statistical area (MSA) have the limits shown above. This includes cities within the following five counties: Clackamas, Columbia, Multnomah, Washington and Yamhill.
Note: A “one-family” home is a traditional single-family home. “Two-family” refers to a duplex-style property with two separate residents, and so on.
Median Home Prices Are Now Higher
Home prices in and around Portland have risen by double digits over the last 12 months. We reported on this trend earlier this month.
According to the most recent Case-Shiller Home Price Index, published at the end of August: “Portland, Seattle, and Denver reported the highest year-over-year gains among the 20 cities over each of the last five months. In June, Portland led the way with a 12.6%…” That’s more than twice the national rate of appreciation during the same period.
This is why the 2016 FHA loan limits for Portland are now lower than the median home price. When HUD established the current limits, at the end of last year, the median sales price for the area was around $320,000. But it has risen significantly since then.
What It Means for Home Buyers and Mortgage Shoppers
The median sales price in Portland was around $387,000 when this article was published, in September 2016. The median is the midpoint for the market. This means that half of all home sales were priced above $387,000, and the other half were priced below it.
The FHA loan limit for Portland is just slightly lower than the median selling price. So home buyers who wish to use this program should still have plenty of homes to choose from within the above-stated limits. But they might have to look a bit harder to find them, as a result of higher home values.
There’s a chance HUD will raise the FHA loan limits for Portland in 2017, in response to significant home-price appreciation. We will know more in December. That’s usually when they announce the revised limits for the following year. As of right now, the FHA loan cap for a single-family home in and around Portland is $368,000.
Need an FHA Loan?
Sammamish Mortgage has been helping home buyers in Portland, and across the Pacific Northwest, for more than 20 years. We offer a variety of products and programs, including FHA loans. Please contact us with any mortgage-related questions you have. You can also request a rate quote online.