House-Hunting in Hawaii? Some Good News For Military and Veterans
Honolulu is one of the most expensive U.S. housing markets.
The U.S. Department of Veterans Affairs has revised and increased the VA loan limit for Honolulu by almost $100,000 — to $721,050 — after a surprising reduction was announced a few months ago.
This means qualified active-duty service members and veterans can afford more expensive houses, thus expanding their pool of properties to choose from.
U.S. Rep. Tulsi Gabbard, D-Hawaii, commended the VA for raising the loan limit.
“The VA’s decision to increase the cap on the home loan guaranty program better fits the real cost of a single-family home in Hawaii, and is welcome news for thousands of veterans and their families who otherwise would be unable to utilize the benefit they earned,” Gabbard, a veteran, said in a statement.
Honolulu’s 2014 VA loan limit was initially set at $625,500 based on new government calculations. That was a dramatic drop from the 2013 limit of $750,000.
The limit oddly declined by 17 percent despite housing prices increasing to record highs on Oahu. The limits, according to VA, are based off median home values estimated by the Federal Housing Administration.
Tony Dias, of Veterans United, said “my initial thought was that this was a typo, but was assured by VA it was not.”
Hawaii’s congressional delegation and others lobbied the VA to reconsider the limits and increase the amounts.
“We need to do more to help our veterans afford to live here, not less,” Sen. Brian Schatz, D-Hawaii, said. “Any change in the VA’s calculations that makes it harder for veterans and their families to buy and own a home is unacceptable.”
U.S. Rep. Colleen Hanabusa, D-Hawaii, wrote a letter to Hawaii-born Secretary of Veterans Affairs Eric Shinseki to reconsider the reductions. She said the lower limits would have an adverse effect on veterans “trying to secure home ownership, a tenet of the American dream.”
“We owe it to the men and women who served honorably in our military to provide excellent care and services,” Hanabusa wrote. “This is one of the most important missions of our nation.”
Under the revised guidelines announced this week, loan guarantees are $721,050 for Oahu, $713,000 for Kauai, and $657,800 for Maui County. The Big Island remains unchanged at $625,500.
Some counties in California have much higher limits than Hawaii’s. For example, San Francisco, Alameda, Contra Costa, San Mateo and Marin have limits of $1,050,000. Nantucket in Massachusetts has the highest at $1,094,625.
Last year, 5,000 families in Hawaii received VA loans, which are provided by many banks and other mortgage lenders. The program, in which the VA guarantees a portion of the loan, has several attractive benefits including competitive rates and a no-down payment possibility.