FHA loan limits for the Portland, Oregon metro area have been increased for 2019 in response to rising home values. In 2019, the FHA loan limit for a home purchased in the Portland area will go up to $474,950. That’s for a single-family property. There are higher limits for multifamily properties like duplexes and triplexes.
Conforming loan limits have gone up as well.
Portland FHA Loan Limit Increased by More Than $26,000
In 2018, the FHA loan limit for a single-family property in Portland was $448,500. But in 2019, it will go up to $474,950. That’s an increase of $26,450. This change was made in response to nationwide home-price gains that have occurred over the past year or so.
The Department of Housing and Urban Development (HUD) announced this change in December, and said that most counties across the nation will see higher limits in 2019.
According to a HUD press release from December 14:
“Due to robust increases in median housing prices and required changes to FHA’s floor and ceiling limits, which are tied to the Federal Housing Finance Agency (FHFA)’s increase in the conventional mortgage loan limit for 2019, the maximum loan limits for FHA forward mortgages will rise in 3,053 counties.”
These limits are based on median home values, and they’re usually the same across an entire metro area. So the $474,950 FHA loan limit for the Portland area applies to the following counties:
Most other counties across the state have lower limits for 2019, as a result of having lower median home prices. Here’s a list for all counties in Oregon.
Home Prices Rising More Slowly in the Area
Speaking of home prices, the rate of appreciation has slowed considerably in the Portland area. From 2015 to 2017, Portland experienced some of the fastest home-price gains among U.S. cities. But the local real estate market began to cool in 2018, and house values are now rising more slowly.
According to the Regional Multiple Listing Service (which serves much of Oregon), the median home price in the Portland metro was $395,000 in October 2018. It might be a bit higher than that now, as we move into 2019. But even so, the median price point is still well below the 2019 FHA limit for the Portland area.
This means that home buyers in the area who plan to use this loan program in 2019 should have plenty of properties to choose from within that price range. More than half of the homes in the Portland metro area are priced below the 2019 FHA loan limit.
Those borrowers who need a higher level of financing can use a “jumbo” loan, provided they have sufficient income to make the monthly payments. (The FHA program is most commonly used by home buyers shopping within the low-to-middle price range.)
FHA vs. Conventional Mortgage Financing
The Federal Housing Administration’s loan program has been helping homeowners since the 1930s. It began during the Great Depression.
The program is especially popular with first-time buyers, because it allows for a low down payment of 3.5%. But it’s not limited to that group. Anyone who meets the basic criteria for the program can apply, and that includes repeat buyers who have owned homes in the past.
Unlike a conventional or “regular” mortgage product, FHA loans are insured by the federal government. This insurance backing allows mortgage lenders to be more flexible, in terms of borrower qualification criteria.