FHA Announces New Single Family Loan Limits For 2021

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Given the continuous gains in home prices over the past couple years, the Federal Housing Administration (FHA) recently announced increases to the FHA Single Family loan limits for 2021. For most of the county the loan limit will increase to $356,362, which is an increase of almost $25,000 compared to 2020’s loan limit of $331,760. But, in “high-cost areas” such as San Francisco and New York City, the FHA loan limit will be $822,375 in 2021, up from $765,600 in 2020. 

The FHA is required by federal law to establish its loan limits based on the GSEs’ loan limits, which are dictated by the Federal Housing Finance Agency home price index.

The FHFA home price index showed that home prices rose by more than 7% in the last year, meaning that the GSE loan limits would increase by the same amount. And as a result, the FHA loan limits are going up too. 

Unlike 2020’s report, the FHA said there are no counties where the loan limits will be decreasing. Back in 2016, the FHA increased loan limits for just 188 counties; in 2017, this number jumped to 2,948 counties; then to 3,011 counties for 2018. In 2021 it will increase for 3,108 counties. 

According to the FHA, the loan limits are effective for case numbers assigned on or after Jan. 1, 2021, through Dec. 31, 2021.