Arizona Mortgage Guide 2026

Buying a Home in Arizona

Arizona sits in a useful position for mortgage borrowers: low property taxes, no real estate transfer tax, and a handful of funded down payment programs that are still accepting applicants. The Phoenix metro median sale price has settled around $450,000 after years of pandemic-era swings — a price point that makes down payment assistance meaningful for a lot of first-time buyers.

This guide covers the specific numbers you need before shopping for a loan in the state: the effective property tax rate, what actually happens at closing (the transfer tax question comes up constantly), and which assistance programs are live right now with current income limits and assistance amounts.

Arizona Property Taxes

Arizona's effective property tax rate on owner-occupied homes is approximately 0.48%, according to Tax Foundation data — one of the lowest rates in the country. The national average sits near 1.1%. That difference adds up fast: a $450,000 home in Arizona generates roughly $2,160 in annual property taxes, while the same home in Illinois or Texas might generate $6,000–$8,000.

Arizona taxes real property on "limited property value," a figure that can lag market value and is capped by statute in how fast it can increase year to year. When you buy, expect the assessor to reassess at or near your purchase price — but future annual increases are constrained.

All figures are estimates using the Tax Foundation's stated effective rate. Your actual tax bill depends on your county assessor's valuation. Source: Tax Foundation — Arizona.

Closing Costs in Arizona — No Transfer Tax

Arizona is one of a minority of states that prohibits real estate transfer taxes entirely. State law bars cities, counties, and towns from imposing any tax on the conveyance of real property. The only state-level charge is a flat $2 recording fee collected by the county recorder when a deed is filed (Arizona Revised Statutes § 11-1132). That's it — no percentage-based transfer or conveyance tax.

Compare that to Colorado, which charges 0.01% in transfer tax, or New York, where combined state and city transfer taxes can exceed 1.4% of the sale price. On a $450,000 Arizona purchase, the absence of a transfer tax saves the seller thousands of dollars that would otherwise need to be negotiated into the deal.

That said, closing costs still add up. Arizona buyers typically pay 2%–5% of the purchase price at closing. On a $450,000 home, that's $9,000–$22,500 out of pocket. The primary expenses are:

• Lender origination and underwriting fees
• Title insurance (both lender's and owner's policies)
• Escrow or settlement fees
• Appraisal ($500–$700 range for a standard single-family home)
• Prepaid items: homeowners insurance premium and property tax reserves (typically 2–3 months)
• County recording fees (Maricopa County charges per-page fees on top of the $2 state deed fee — expect $30–$90 total)

First-Time Buyer & Down Payment Assistance Programs

Three state-administered programs are currently funded and accepting applicants as of mid-2026. All three work through approved lenders — you apply through a participating bank or mortgage company, not directly with the state agency.

Home Plus (AzHFA) — Statewide

The Arizona Housing Finance Authority's Home Plus program pairs a 30-year fixed-rate FHA, Conventional, VA, or USDA mortgage with a no-payment second loan equal to up to 4% of the first mortgage amount. That second loan is forgivable after three years if you stay in the home and don't refinance. Income limit as of April 2026: $155,386 for all borrowers combined. Available in all 15 Arizona counties with no geographic restrictions.

One borrower must complete a HUD-approved homebuyer education course before closing. No first-time buyer requirement — repeat buyers qualify. Official source: homeplusaz.com and housing.az.gov.

Arizona is Home (ADOH) — Maricopa & Pima Counties

The Arizona Department of Housing launched this program in 2024 with $13 million in initial funding, then added $5 million more in 2025 using Arizona Rescue Plan Act dollars. As of that expansion, more than 500 households had closed. The program targets first-time buyers (defined as no homeownership in the prior three years) in Maricopa and Pima Counties.

Assistance is tiered by income: buyers at or below 80% of Area Median Income can receive up to $30,000; those between 81% and 120% AMI can receive up to $20,000. Official source: housing.az.gov/general-public/arizona-home-program.

Pathway to Purchase — 17 Municipalities

This program provides a five-year forgivable second mortgage equal to 10% of the purchase price, up to $20,000, for buyers purchasing in one of 17 participating Arizona cities and towns. Check the ADOH website for the current list of participating municipalities — it changes as funding cycles renew. The first mortgage must be a 30-year fixed-rate loan. Source: Arizona Department of Housing / housing.az.gov.

Sample Monthly Payment — Phoenix Area

The following is an illustrative estimate only, built on a Phoenix-area median price of approximately $450,000 (Zillow/Houzeo data, early 2026), a 30-year fixed mortgage at a hypothetical 6.75% rate, 5% down payment, and the statewide average property tax rate and homeowners insurance cost. Your actual payment will vary based on credit score, lender, property location, and insurance carrier.

Rate assumption is illustrative. Check current rates on our Rates Today page. PMI drops off once your loan-to-value reaches 80%.

A few things to note about that number. The property tax component is notably low by national standards — $180/month versus $500+ in a high-tax state. Homeowners insurance has risen sharply in Arizona (rates up roughly 70% since 2019, per industry data), so getting multiple quotes matters more now than it did three years ago.

If you qualify for the Home Plus program and use the 4% assistance to cover your down payment shortfall or buy down closing costs, you may be able to eliminate PMI sooner or free up cash reserves. Run both scenarios through a lender before deciding.