FHA Property Requirements

Home buyers who want to buy their home with an FHA mortgage may discover an unpleasant surprise: They are not allowed to buy a certain property because it is not up to FHA standards.

What Are the FHA Property Requirements to Get Approved?

To qualify for a FHA loan, the house must meet the property requirements outlined by the Federal Housing Administration. The RefiGuide can help you learn about property requirements for FHA loans. Below are some helpful financial resources that can assist you as you are getting your credit to buy a home:

What Are FHA Loan Property Condition Requirements​ in 2025?

In 2025, the Federal Housing Administration (FHA) continues to enforce specific property condition requirements to ensure the safety, security, and soundness of homes financed through FHA loans. These standards are designed to protect both the borrower and the approved FHA lender by guaranteeing that the property is livable and structurally sound.

Structural Integrity and Safety

The FHA mandates that properties must be free from significant structural defects. This includes ensuring that the foundation is stable, the roof is in good condition with a remaining life of at least two years, and there are no issues compromising the building’s integrity. Additionally, the property should not have any interior or exterior health and safety hazards, such as exposed wiring or unstable staircases without proper handrails.

Access and Utilities

Properties must have safe and adequate access, meaning they should be reachable via a public or private road. All essential utilities—including electricity, gas, water, and sewage systems—must be operational and compliant with local codes. The heating system should be permanent and capable of maintaining a minimum temperature as required by local regulations.

Health and Environmental Standards

The FHA requires that homes be free from environmental hazards and conditions that could affect the occupants’ health. This includes ensuring that there is no presence of lead-based paint, especially in homes built before 1978, as peeling or chipping paint can pose serious health risks. Furthermore, the property must be free from wood-destroying insect infestations, such as termites, which can compromise structural integrity.

Appraisal and Compliance

An FHA-approved appraiser must evaluate the property to confirm it meets all FHA property standards. If the appraiser identifies any deficiencies, these issues must be resolved before the loan can proceed to closing. This process ensures that the property is in compliance with FHA guidelines and is safe for occupancy.

In summary, the FHA’s property condition requirements in 2025 emphasize the importance of safety, structural integrity, and habitability. Prospective buyers and sellers should be aware of these standards to ensure a smooth transaction process when dealing with FHA-insured loans.

Minimum Property Standards Set by FHA

The US Department of Housing and Urban Development states that FHA requires properties that it finances with its loans to have these standards at minimum:

• Safety: The home should be of good enough quality to protect the safety and health of all occupants
• Security: The home must protect the overall security of the property
• Soundness: The property should not suffer from major physical deficiencies that affect the overall structure

When you put a contract on a property you want to buy with an FHA loan, the FHA approved appraiser will review the condition of the home and report the results to FHA.

For a single-family home, the appraiser will use the Uniform Residential Appraisal Report. According to FHA loan requirements, the form requires the appraiser to describe the features of the home, including these items:

• Square footage
• Year it was built
• Number of stories
• Number of rooms and where they are

The appraiser must also describe the overall condition of the home, such as needed repairs, deterioration, remodeling and renovations done. The form also asks if there are any physical deficiencies that will affect the soundness and livability of the property. Check todays FHA loan rates.

FHA does not require minor defects to be fixed, nor does normal wear matter if it does not affect the soundness and security of the home. Some examples of minor issues that do not affect the home sale are:

• Cracked windows
• Missing handrails
• Worn out counters
• Defective paint
• Minor plumbing leaks
• Trip hazards
• Damaged doors that are operable

However, there are many areas of the home that FHA will require to be fixed for the sale to be closed and the FHA loan to be funded . Some of the most common problems that can delay a closing on a home are:

• Electrical and heating issues, such as electrical box problems; lack of heating source for each room
• Roof and attic, such as the roof will not last at least two more years, and general roof problems seen upon attic inspection
• Water heater – must meet local building standards and must be left with the home
• Hazards and nuisances, such as hazardous waste site nearby, contaminated soil, heavy traffic, oil and gas wells, airport noise, near high power lines, near a radio or TV tower

Also, the home must provide ‘safe and adequate accesses for vehicles and pedestrians. The street must have an all-weather surface so emergency vehicle can access the home in any weather condition.

Further, the home must have at least one function toilet, shower and sink; it is not uncommon for people to take these things when the home is foreclosed. The home should also have a functioning stove, but there are not any specific appliance requirements stipulated in the regulations.

What Are FHA Loan Rental Property Requirements?

FHA loans are primarily designed for owner-occupied properties, meaning you cannot use them to purchase an investment property unless you meet specific criteria. However, FHA allows buyers to purchase multi-unit properties (up to four units) as long as they live in one of the units as their primary residence for at least one year. This makes FHA loans an attractive option for house hacking, where buyers rent out the remaining units to generate income.

Additionally, the rental income from the other units may be considered to help qualify for the loan, provided the property meets FHA appraisal and rental stability requirements. FHA also requires the property to meet minimum property standards, ensuring it is safe, structurally sound, and has operational utilities.

For existing homeowners looking to rent out their FHA-financed home, they must first fulfill the one-year residency requirement before converting it into a rental. If they wish to use an FHA loan again for another property, they must provide justification such as job relocation or an expanding family.

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