In a previous post of Jan 16, 2008 I discussed various city programs in Northern California for assisting first time home buyers with downpayment through low interest loans that can be paid off upon refinance or sale of the property. The income qualification to be eligible for such a program may disqualify some with good incomes, but no downpayment. But for families with low to moderate incomes they should definitely look into these city programs. Developers, by law, need to set aside some units for low to moderate income buyers and now cities through their websites are helping to promote the units available from developers. See this example webpage from Dublin,CA. Note that a realtor can represent a low to moderate income buyer and refer them to these properties, but no commission will be paid by the developer.
With interest rates coming down, home buyers who are able to qualify to purchase a home or condo or townhome should seriously consider acting now. Payments for 30 year fixed mortgages are low and home ownership is more affordable now than in recent years of high price appreciation. The price points in the real estate market have gone down, but in many desirable neighborhoods in Northern California the prices have not dropped as much as people think. Rather than sell at a lower price point, where they can afford to do so, homeowners in premium neighborhoods are taking properties off the market and renting them in order to ride out the cycle of price adjustment. So if you see an attractively priced starter home, where the developer or the owner is willing to be flexible with the pricing, you do the math. If you can afford the payments and you can get help with the downpayment, your monthly cost of owning after tax even including mortgage insurance and property taxes may be comparable to renting. Lenders have been chastised by prior loose lending practices and will no longer give you a pass and allow you to sign for a mortgage that you cannot afford. So if your aim is to become a home buyer and you are able to find a team of sellers, lenders and city assistance programs to help you achieve that goal, you should seriously consider acting now. Waiting will just amount to missing the wave of opportunity. Once the market rebounds, it will do so aggressively and you will lose the flexible seller member of your home buying team.
I’ll be updating the list of Northern California city webpages offering first time buyer assistance programs in a future post.
