Affordable Housing in South Florida?

It is essential for Realtors to realize the true meaning of the housing crisis experienced by both, home buyers and sellers. It's no mystery that the median home price in both Broward and Miami-Dade County is about $350,000 skyrocketing at an alarming 30% these past couple of years. That's fantastic news for those homeowners that either owned there homes for some time or those that jumped on the band wagon early on. On the other hand, it's made things extremely difficult for the working class to afford to own their own home where they've worked and lived for years. Median income is hovering around $45,000 which would only qualify a potential homebuyer for a loan of about $200,000. This gap is something that needs to be addressed, and soon if we are to strengthen the very fiber of our economy. How is it that we can stand by and do nothing to help.

Realtors and Lenders have felt the impact this issue has created and some have stepped up to the plate to create the solution. It is no longer acceptable for professionals in the Real Estate industry to simply go about doing business in the traditional sense of the word.

Yes, there is a Housing Crisis and it's not pertaining to inventory. There are plenty of new homes being built every day in South Florida. The true crisis is in creating the funds necessary to narrow the gap. First time home buyers are especially affected. They are either beginning to establish their credit or just don't have that hefty down payment that will have their offer accepted. They might qualify for 100% financing, but get turned down by the Seller because some investor with deep pockets has offered to pay cash, and in some cases, has paid above the asking price. There are solutions!

First Time Homebuyer Program

Bonds are issued under the Single Family Mortgage Revenue Bond Program and uses the bond proceeds to originate 30-year mortgage loans through its First Time Homebuyer Program. At press time, the interest rate on these loans 5.49 percent for some community workers.

Grants & Subsidies

Did you know that you can obtain up to $80,000 in grants and subsidies offered below market interest rates that you might not need to even make a payment on. This money instantly creates a more feasible scenario. There are a number of ways that funds can be made available to those who qualify (primarily first time home buyers), it's just a matter of knowing where to go or what to do.

Mortgage Credit Certificate Program

The Mortgage Credit Certificate Program allows home buyers to claim a tax credit for some portion of the mortgage interest they pay per year. It's a dollar-for-dollar reduction against their federal tax liability. An MCC may be issued to home buyers at tax credit rates varying from 10 to 50 percent, based on the mortgage interest paid per year and capped at $2000 annually.

Down Payment Assistance Program

Funds for down payment assistance and closing costs are often provided inconjunction with the First Time Homebuyer Program through the Homeownership Assistance Program (HAP), the Home Investment partnerships Program, the homeownership Assistance for Moderate Income (HAM) Program and the Three Percent Cash Assistance Program.

Fannie Mae's My Community Program

Fannie Mae's Community Lending mortgage products and options are designed to help borrowers overcome the two primary barriers to homeownership: lack of down payment funds and qualifying income.

Employer Assisted housing

Employer-Assisted Housing (EAH) is an employee benefit that can be used with any Fannie Mae mortgage product. Employers can offer an EAH benefit to meet one or more of the following goals:

recruitment
retention
revitalization
return to the bottom line
recognition for the company

The most common benefits are grants, forgivable loans, deferred or repayable loans, matched savings, interest-rate buydowns, shared appreciation, and home-buyer education (provided by an employer-funded counseling agency).

These are just a few ways to better assist a potential homebuyer realize their American Dream. I will do my best to keep you up to speed on what new programs develop.