Thinking about buying a home in Rhode Island? Statewide, the median house costs $253,000, slightly lower than the national median home price of $257,600. The median home price in Providence, Rhode Island’s largest city, is $294,200. As with the rest of the nation, prices are slowly rising: The market grew 3.6% between January 2018 and January 2019.
If you’re worried about financing, you may want to consider a mortgage backed by the Federal Housing Administration (FHA). FHA loans typically have more lenient down payment and credit score requirements.
Note, however, that the FHA places limits on the size of mortgages it’s willing to insure. Those limits change every year to keep up with changing home prices. In Rhode Island, the loan limit is the same no matter where you live: $454,250.
Rhode Island FHA Loan Limits by County
|County Name||One-Family||Two-Family||Three-Family||Four-Family||Median Sale Price|
How are FHA loan limits calculated?
FHA loan limits are determined by the Department of Housing and Urban Development (HUD), which uses the conforming loan limit to make its determination. The conforming loan limit is the largest mortgage that Fannie Mae and Freddie Mac will buy. That limit is $484,350 in 2019.
That number helps the FHA set a loan “floor,” meaning the largest mortgage they’ll insure in low-cost areas. In 2019, that number is set at $314,827.
The FHA also sets a “ceiling,” which applies in high-cost areas. The ceiling is set at 150% of the conforming loan limit, or $726,525 in 2019. In most cases, this is the largest mortgage the FHA backs for a single-family home. Depending on each individual county’s median home cost, loan limits will fall somewhere between the FHA floor and ceiling — like in Rhode Island.
These are the 2019 standard FHA limits for different housing sizes nationwide:
- One-unit: $314,827
- Two-unit: $403,125
- Three-unit: $487,250
- Four-unit: $605,525
These are the 2019 standard FHA limits for high-cost areas nationwide:
- One-unit: $726,525
- Two-unit: $930,300
- Three-unit: $1,124,475
- Four-unit: $1,397,400
Are you eligible for an FHA loan in Rhode Island?
Interested in making this small state your homebase? An FHA loan can make that possible, as long as you will require a mortgage of no more than $454,250. To learn more about taking out an FHA loan — including credit, income and other requirements — check out our complete guide to FHA loans.