ORLANDO, Fla. – Nov. 14, 2016 –The number of U.S. downpayment assistance programs decreased 3 percent from the previous quarter, according to Down Payment Resource’s Third Quarter 2016 Homeownership Program Index (HPI).
However, of the nation’s 2,392 programs, almost 88 percent currently have funds available for eligible homebuyers, an increase of 3 percent from the previous quarter. When seeking help, buyers found, on average, 8.5 downpayment programs per search.
According to Down Payment Resource, 238 programs exist in Florida to help buyers secure a home, though some programs offer help in only selected areas. The only state with more programs to help buyers is California with 380.
The overall drop in the number of programs was primarily due to the expiration of Neighborhood Stabilization Programs (NSP) offered by localities after the housing crisis, which was expected as NSP funding came to a halt after round three in 2010.
Moderate-income workers in high-cost markets often opt out of homeownership due to high home prices and market competition. As a result, more areas are launching programs to retain important community service workers. Overall, 6 percent of downpayment programs are available for community service workers, including educators, police officers, firefighters and healthcare workers.
Typical downpayment assistance program buyer
- Average household size: 2.75
- Average household income: $53,846
- Average home purchase price: $180,084
- Homebuyers found an average of 8.5 programs per successful search
To qualify for a homeownership program, both the buyer and the property must meet certain criteria, which vary by program. These demographics suggest healthy incomes, growing families and a wide array of homeownership programs available to the next wave of prospective buyers.
Downpayment program highlights
- 64% of programs have a first-time homebuyer requirement. HUD defines this as someone who has not owned a home in 3 years.
- 76% of programs are available in a defined area, such as a city, county or neighborhood.
- 24% of programs are available statewide through state housing finance agencies.
- 6% of programs are available for community service workers, including educators, police officers, firefighters and healthcare workers.
- 5% of programs have benefits for veterans and members of the military. These programs can also be layered with zero downpayment VA loans.
- Nearly 70% of programs in the database are downpayment or closing cost assistance.
- 9% of programs are first mortgages and 8% of programs are Mortgage Credit Certificates (MCCs).
- More than 50 percent of programs accept online homeownership education.
Since every downpayment assistance program has unique rules – specific geographic areas, income levels, etc. – a master list doesn’t exist. However, the Florida Housing Finance Corporation operates at the state level to funnel money into many programs and can offer some guidance. In addition, some local mortgage brokers often specialize in downpayment assistance programs.
© 2016 Florida Realtors®