diff --git a/app/models/project.rb b/app/models/project.rb
index 9d61ffc1ac5..b7d688bf8f5 100644
--- a/app/models/project.rb
+++ b/app/models/project.rb
@@ -146,7 +146,7 @@ class Project < ActiveRecord::Base
   end
 
   def saved?
-    id && valid?
+    id && persisted?
   end
 
   def import?
diff --git a/spec/requests/api/projects_spec.rb b/spec/requests/api/projects_spec.rb
index 4ac1e7cc31c..586f108ca9e 100644
--- a/spec/requests/api/projects_spec.rb
+++ b/spec/requests/api/projects_spec.rb
@@ -33,6 +33,20 @@ describe Gitlab::API do
   end
 
   describe "POST /projects" do
+    context "maximum number of projects reached" do
+      before do
+        (1..user2.projects_limit).each do |project|
+          post api("/projects", user2), name: "foo#{project}"
+        end
+      end
+
+      it "should not create new project" do
+        expect {
+          post api("/projects", user2), name: 'foo'
+        }.to change {Project.count}.by(0)
+      end
+    end
+
     it "should create new project without path" do
       expect { post api("/projects", user), name: 'foo' }.to change {Project.count}.by(1)
     end
@@ -41,6 +55,12 @@ describe Gitlab::API do
       expect { post api("/projects", user) }.to_not change {Project.count}
     end
 
+    it "should create last project before reaching project limit" do
+      (1..user2.projects_limit-1).each { |p| post api("/projects", user2), name: "foo#{p}" }
+      post api("/projects", user2), name: "foo"
+      response.status.should == 201
+    end
+
     it "should respond with 201 on success" do
       post api("/projects", user), name: 'foo'
       response.status.should == 201