Arizona Home Loans & Mortgage Rates

Arizona’s housing market has settled into a healthy balance after the wild swings of 2021-2023, and there are some real advantages to buying here right now.

The statewide median home price sits around $430,000 with modest appreciation of about 1.8% year-over-year. The Phoenix metro (Maricopa County) has a median around $450,000, while Tucson (Pima County) is significantly more affordable at roughly $330,000. Inventory has climbed to about 4.5 months of supply, days on market have stretched to 55, and sellers are regularly offering concessions. The frenzy is over, and buyers actually have time to shop and negotiate.

One important thing about Arizona: no county qualifies as high-cost for FHA purposes. The highest FHA limit in the state is $609,500 in Coconino County (Flagstaff area). Phoenix/Maricopa is at $557,750 and Tucson/Pima is at baseline $541,287. The conforming limit is $832,750 statewide. This means buyers looking at properties above $600K will typically need conventional or jumbo financing.

Arizona makes up for the moderate loan limits with excellent DPA programs. The Home Plus program (available statewide through the Arizona IDA) provides up to 5% toward down payment and closing costs, with both forgivable and deferred options. The Home in Five program in Maricopa County offers up to 4% forgivable assistance. And the state has no transfer tax, which keeps closing costs lower than many states.

Property taxes are among the lowest in the nation, with the statewide average effective rate around 0.44%. Combined with no state tax on military retirement pay and a flat 2.5% income tax rate, Arizona is one of the most tax-friendly states for homeowners.

2026 Loan Limit Takeaways

Coconino County (Flagstaff) has the highest FHA limit in the state at $609,500 due to elevated home prices in the Flagstaff area. Maricopa County (Phoenix metro) and Pinal County are at $557,750. All other 12 counties sit at the $541,287 FHA baseline. The conforming limit is $832,750 statewide with no high-cost exceptions. Buyers looking at Scottsdale luxury properties or higher-end Phoenix neighborhoods will likely need conventional or jumbo financing.

Down Payment Assistance Notes

The Home Plus program is the standout: available statewide, open to repeat buyers, never runs out of funding, and offers up to 5%. The forgivable option (forgiven over 36 months) means if you stay in the home 3 years, it’s free money. Maricopa County buyers can choose between Home Plus and Home in Five — compare rates and terms. The Arizona Is Home program offers below-market rates but has limited annual funding and excludes Maricopa and Pima counties. Phoenix and Tucson each have city-specific programs that can provide additional assistance.

Closing Costs in Arizona

Arizona closing costs are among the lowest in the country thanks to no transfer tax and a straightforward closing process.

No Transfer Tax: Arizona does not charge a real estate transfer tax. This saves both buyers and sellers compared to most states. There is a small recording fee, but no percentage-based transfer tax on the sale.

No Mortgage Recording Tax: Arizona does not charge a separate tax on mortgage recording. Combined with no transfer tax, this makes Arizona one of the cheapest states for transaction-related government fees.

Title/Escrow State: Arizona uses title companies and escrow for closings (not attorneys). This tends to be less expensive than attorney-required states. Title/escrow fees typically run $1,200-$2,000. Buyer pays for lender’s title insurance. Seller typically pays for owner’s title insurance (negotiable).

Affidavit of Value: Arizona requires an Affidavit of Property Value to be filed with the county recorder for most property sales. This is a disclosure document, not a tax.

Estimated Total Buyer Closing Costs: On a $430,000 purchase with a $415,000 mortgage, expect approximately $7,700-$15,000 in total buyer closing costs (1.8-3.5%). This includes lender fees, title insurance, escrow fees, appraisal, prepaid taxes and insurance, and recording fees. The absence of transfer and mortgage recording taxes keeps Arizona costs well below the national average.

Property Taxes in Arizona

Arizona has one of the lowest property tax burdens in the country, ranking third-lowest among all states.

Statewide Average: Arizona’s average effective property tax rate is approximately 0.44%, well below the national average of roughly 0.89%.

How Arizona Property Tax Works: Arizona uses a “Limited Property Value” (LPV) system that caps how much your assessed value can increase each year (maximum 5% annually). Tax is applied at 10% of the LPV for residential property, then multiplied by the local mill rate. This system protects homeowners from dramatic tax increases even when home values spike.

Rates by County: Maricopa County (Phoenix) averages about 0.40-0.56% effective rate with a median bill around $1,916-$1,965. Pima County (Tucson) is higher at approximately 0.65-0.78%, median about $2,248. Coconino County (Flagstaff) is about 0.42%. Yavapai County (Prescott) is approximately 0.58%. Rural counties like Greenlee and La Paz are even lower.

Exemptions: Arizona’s Senior Property Valuation Protection Option (“Senior Freeze”) allows homeowners 65+ to freeze their home’s assessed value for up to 3 years. Disabled veterans qualify for property tax exemptions. Widows and widowers may qualify for additional exemptions. There is no broad homestead exemption like in Florida or Texas.

On a $430,000 home in the Phoenix metro, expect roughly $1,700-$2,400 per year in property taxes. In Tucson, expect $2,800-$3,350 on a similar value home due to the higher Pima County rate.

USDA Loan Eligibility in Arizona

Arizona has significant USDA eligibility outside the Phoenix and Tucson metro areas.

Eligible areas include much of rural Maricopa County (far west and far east of the Phoenix metro), most of Pinal County between Phoenix and Tucson, the Prescott area fringes (Yavapai County), and nearly all of Cochise County (Sierra Vista area). The White Mountains region (Navajo and Apache counties), Yuma County outside the city proper, Mohave County (outside Lake Havasu City and Kingman core areas), and most of Graham, Greenlee, La Paz, Gila, and Santa Cruz counties qualify.

Even within commuting distance of Phoenix, some outer communities in the Queen Creek, San Tan Valley, and Maricopa (city) areas have USDA-eligible pockets. Casa Grande and surrounding areas in Pinal County often qualify. Sierra Vista (near Fort Huachuca) has qualifying areas and is popular with military families combining VA or USDA loans. Check specific addresses at the USDA eligibility map.