Texas offers $45M in First Time Home Buyer Assistance

The Austin Business Journal reports that the State of Texas has released $45 Million in a first-time homebuyer assistance program.   Don't forget, also, there are still funds in the Bond 77 Program for downpayment assistance.

It's a great time to buy and there are some great deals out there.   Rental rates are rising, so there may never be a better time to buy in Austin, TX. 

Call or email us for more information or a free list of properties.   Visit our website at www.ppgtx.com 

Visit our website for free foreclosure/short sale information:   www.ppgtx.com/foreclosures

First Time Buyer? Thinking of Buying? Should I Buy or Rent?

To Buy or Not to Buy – Should I Buy or Rent a Home?

Buying a home is not for everyone in every area nor is renting. Obviously consideration needs to be made on both a personal and market location basis.

The National Association of Realtors recently published results from it’s 8^th Annual Housing Opportunity Pulse Survey which indicates that nearly 8 our of 10 Americans still believe that buying a home is a good financial decision. 77 percent believe strongly or not so strongly, 68 percent strongly so. More than 68% believe that now is a good time to buy a home.

Here in Austin, we have fared better than in many regions of the country. A recent article in Newsweek ranked Austin as one of four Texas cities in its list of the 10 cities best situated for economic recovery. It described Texas as the “Number 1 destination for job-seeking Americans, thanks to a hearty energy sector and a strong spirit of entrepreneurism.”

With respect to housing, projections are that the Austin area will have increasing rental rates over the next year(s), which will make homeownership more attractive to many. Marcus & Milchap reported in November that area apartment vacancies are expected to fall with relatively few projects coming online. Developers report bringing about 2900 new units on line this year versus an annual average of about 4300 per year for the last five years. Rising demand and reduced supply is expected to push rental rates up about 3% in the near future.

In addition, the number of spec homes being built has decreased dramatically over previous years. The combination of these two reductions in conjunction with new job creation will likely create some reduction in housing availability. So far, we have had about 23,000 new jobs created this year and it is anticipated that we will continue to have net job increases over the next several years. The Milken Institute’s October 2010 Report – Best Performing Cities-2010: Where America’s Jobs are Created & Sustained lists Austin as #2

Fiserv Inc forecasts average single-family home prices to fall another 7.1 percent during the next 12 months in the US, though less than 1 percent in Austin. Continued home price declines are expected in markets that have been hurt most by the housing crisis. In Austin, however, we are fortunate to have many popular areas or popular price points that have remained fairly stable or had recent increases in values, not decreases.

Very low interest rates, tax deductions and even a small or neutral average appreciation, combined with relative market stability, potential increased rental rates and decreased rental availability and current home affordability mean that home ownership may make sense particularly for those planning to stay in a home for 3-5 years, at least in the greater Austin area.

For those who stay in their home and pay it off, there are obvious benefits since they will no longer be making mortgage payments - just taxes, insurance and maintenance. For those looking toward their future retirement, continued home ownership can be the right thing.

For many, there are psychological advantages to owning - personally I just prefer to be my own landlord, so to speak. I have the flexibility to do what I like and no matter what, I have to have a place to live. If I have to pay for a place to live anyway, I'd rather have the control myself and not rely upon a landlord to maintain the property properly and in a timely fashion or to keep a fair rental rate indefinitely.

Most investment advisors will tell you that you need to hold your investments in stocks or bonds over a longer time period. There will be ups and downs in the market, but over time, their goal is to make you money over that time period. Selling at any given time during that period may net you a loss or a profit. If your investment goes up 20%, have you really “made” money? I say “no”, unless you actually sell the investment. You could own that investment for 10 years and it could go up and down over time, but you really only “make” that gain (or loss) when it is sold.

The same could be said for owning a home or other real estate. Many markets have experienced substantial ups and now substantial downs. Over time, if you view your home in the same way as you might view your stocks and bonds, chances are you will experience a positive gain over time. The difficulty for many right now is how long that time period is and can you wait it out. One positive in the Austin area is that we generally have experienced a less dramatic downward market swing and are now trending positively in many categories.

If you know that you are going to have to move again in 2 years or think you may lose your job in the near future, it may not be prudent to buy, but if you plan on staying in your home 5 years or more, particularly if buying now while prices are affordable, it may well be the right thing for you to do.

To buy or rent - it’s a very personal decision, largely based on your own circumstances and locale. For some, renting is the way to go for now. For others, now may be the best time to buy and take advantage of low interest rates and affordable home prices, particularly here in the Austin area.

Here in Texas, we are fortunate to be able to offer a Downpayment Assistance Program to make it easier for people to buy a home. And, if you are military, former Military, an Educator, Medical Personnel or a First Responder, we have a CASH BACK Bonus whether you are buying or selling.

Give us a call, email to suemellett@yahoo.com or visit our website at www.ParagonPropertyGroup.Com

Sue Ellett

Broker-Associate

Paragon Property Group

Coldwell Banker United Realtors

866-693-7741

New - Statewide 2nd Lien Downpayment Assistance Program

FIRST TIME HOMEBUYER in Texas?? - now is the time to take a look a buying your own home!

Here in the Austin and Highland Lakes areas of Travis, Burnet, Hays, Llano, Blanco and Hays counties, you may be able to take advantage of the First Time Homebuyer Tax Credit as a downpayment. There are many reasonably priced homes in our area and plenty of bargains, so it's a great time to buy!

Thinking of buying a home and using the $8,000 Federal Tax Credit? There is a new program to help use this $8,000 tax credit as a downpayment. Call us at Paragon Property Group for more information.

The Texas Department of Housing and Community Affairs (TDHCA) has announced two new downpayment assistance programs that allow you to take advantage of a short term loan prior to filing and receiving the First Time Homebuyer Tax Credit. The program is outlined below.

90 Day Down Payment Assistance Program

5% of the first lien mortgage amount up to a maximum of $7,000 for down payment and/or closing costs.

Program is only available in onjunction with first lien mortgage loans originated by a participating lender.

0% interest for 90 days.

Failure to repay within 90 days results in a monthly payment of principal & interest for 2 years with an interest rate of 10% This translates into a second lien note of $7,000 which is about $323/month.

Income limit for single taxpayers is $75000 and $150,000 for married taxpayers filing a joint return.

Mortgage Advantage Program

5% of the first lien mortgage amount up to a maximum of $6,000 for a down payment and/or closing costs.

The tax credit is equal to 10% of the home's purchases price up to a a maximum of $8000.

Homebuyers must meet the First Time Homebuyer or Mortgage Credit (MCC) Program guidelines.

0% interest for 120 days.

Failure to repay the down payment assistance loan in full within 120 days will resul in monthly payments of principal and interest for 5 years with an interest rate of 7%. Using this scenario, a homebuyer borrowing the maximum of $6,000 would have a second lien note of approximately $119/month.

Applicable income limits for the Texas First Time Homebuyer or Texas Mortgage Credit Programs.

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Both of the programs require the homebuyer to complete a pre-purchase homebuyer education course. Homebuyers must be eligible to claim the federal first time homebuyer tax credit (can not have owned a home in the last 3 years). Homebuyers must complete IRS Form 5405 and file an amended 2008 IRS federal tax return.

All purchases msut close by December 1, 2009.

Funds area available on a first come, first served basis.

The tax credit must be repaid to the IRS if the borrower sells or moved from the home within 3 years of purchase.

There is a $250 administrative fee for either program.

Tax refunds are generally processed within 8-12 weeks. TDHCA recommends that each taxpayer consult with their tax advisor on how to maximize their benefits.

For current available program funds please visit the Available Funds page.