The Arizona mortgage market
Overview
Arizona's housing market has been one of the most active in the Southwest since 2020, driven by net migration from California, Texas, and the Midwest. Phoenix metro home prices have grown faster than most U.S. metros but remain accessible relative to California, drawing first-time buyers and remote workers.
Arizona has relatively low property tax rates (0.5%–0.85% effective), which makes the same home price translate to a noticeably lower monthly PITI than in Texas or much of the East Coast. The state has no inheritance tax and a flat state income tax, both attractive to retirees moving into Sun City, Surprise, and other 55-plus communities.
Down-payment assistance is generously layered in Arizona, with overlapping programs from AzIDA, county-specific programs in Maricopa and Pima, and city-specific options in Phoenix, Tucson, and Mesa. Many borrowers stack two or three assistance sources to come to closing with little or no cash out of pocket.
Arizona loan programs & assistance
State-specific programs that layer with FHA, VA, USDA, and conventional financing.
Frequently asked questions
What are property taxes like in Arizona?+
Arizona has some of the lower effective property tax rates in the U.S., typically 0.50%–0.85%. The state also caps annual assessed-value increases at 5% for most owner-occupied homes. Combined, this keeps property tax escrow payments lower than national averages — a meaningful monthly savings versus comparable home prices in Texas or the Northeast.
Can I combine Arizona's HOME Plus with FHA?+
Yes. HOME Plus is structured as a down-payment assistance grant or second mortgage that pairs with a first mortgage — FHA, VA, USDA, or conventional. You don't need to choose between assistance programs and government loan programs; they stack together.
Is Arizona a good state for first-time buyers?+
Arizona has been one of the most first-time-buyer friendly states recently. Multiple stackable assistance programs, lower property taxes than national averages, no down-payment requirement on USDA loans (eligible in many Pima and rural areas), and a growing inventory of new construction make Arizona accessible compared to coastal markets.
Do Arizona's 55-plus communities have special mortgage considerations?+
Age-restricted communities (like Sun City, Sun Lakes, and Trilogy) are eligible for conventional, FHA, VA, and USDA financing as long as the development meets the appropriate guidelines and the borrower is age-qualified. Some HOAs have special assessments or amenity fees that affect underwriting — your loan officer will factor those into your DTI calculation.