Short-term voltage instability (STVI) imposes a severe threat to modern distribution systems where a large number of intermittent distributed generator (DG) units, like rooftop photovoltaic (PV), is being integrated. Consequently, most of the international standards have been revised by incorporating the requirement for dynamic voltage support (DVS) through DG units, which is a promising approach to alleviate the STVI. In this paper, a novel DVS strategy is proposed to improve the short-term voltage stability (STVS) in residential grids. In comparison with other DVS strategies, the proposed DVS scheme maximizes the active power support from PV units following a contingency utilizing maximum allowable current of the PV inverters. The impact of inverter design margin on the STVS is explained, and the effectiveness of the proposed DVS strategy compared with conventional DVS is demonstrated. The feasibility of the DVS control strategies in practical application is studied. Several case studies are carried out on benchmark IEEE 4 bus and IEEE 13 node test systems. The results show that the proposed DVS scheme is feasible and has superior performance compared to the other strategies. Furthermore, it has been shown that implementation of the proposed DVS control can avoid an expensive 1200 kVA D-STATCOM for STVS improvement in the target system.