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Now is the Time to Buy a Home

by Grants.com
The $8,000 federal first-time homebuyers tax credit may have expired, but there are plenty of other programs and incentives out there that are still leading buyers off the fence to take advantage of low interest rates and home prices that have yet to return to pre-recession levels.

The housing crisis and subsequent credit crunch may have given consumers the jitters, but there are signs that people are buying more houses than they have in the last three years, capitalizing on the affordability of the housing market in a down economy.

\n\nAccording to the National Association of Realtors, pending home sales in June show a three-month consecutive rise. "The Pending Home Sales Index, a forward-looking indicator, rose 6 percent to 110.9 based on contracts signed in April, from an upwardly revised 104.6 in March, and is 22.4 percent higher than April 2009 when it was 90.6. That follows gains of 7.1 percent in March and 8.3 percent in February," NAR said in a new June press release.

NAR economist Lawrence Yun commented on the rise in the Pending Home Sales Index by saying, "The housing market has to get back on its own feet and now appears to be in a good position to return to sustainable levels even without government stimulus, provided the economy continues to add jobs.” Homebuyers should look to the existing federal, state and local programs for incentives to buy, including those specially-funded by stimulus dollars to bring the economy back by the brink.

The U.S. Department of Agriculture has an program for homebuyers who desire to live in rural areas. to qualify for rural housing guaranteed loans applicants must have an income of up to 115 percent of the median income for the area. Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance. In addition, applicants must have reasonable credit histories.

Many states have their own tax credit incentive programs to supplement the now-expired federal tax credit. Many of those programs are still in effect. The National Council of State Housing Agencies also has resources on tapping into various housing credit assistance programs. On the local level, there are community agencies that administer state and federal programs. To find one in your area, check the website of the U.S. Department of Housing and Urban Development.

Some local city government and regional public/private partnerships may have developer grants for homebuyers who are relocating to blighted areas that are set for investment and neighborhood revitalization or areas that want to attract more workers, but have a shortage in available housing.

For instance, the city of Odessa, Texas has a workforce housing incentive program, that gives incentives for workers who need help finding housing due to shortages in the area. The program gives incentives of between $4,000 and $5,000 to developers who build homes priced between $70,000 and $170,000, the amounts considered viable for attracting workers to the city.

Specifically, the incentives for home prices are as follows:
  • $70,000 to $99,999 (1077 square feet minimum): $5,000.
  • $100,000 to $129,999 (1,250 square feet minimum): $4,500.
  • $130,000 to $170,000 (1,444 square feet minimum): $4,000.
Each has a $500 bonus for building in "target areas."