Aspiring home buyers from lower-income households in Sarasota have a reason to cheer these days even as a sharp rebound in residential prices over the past two years and sluggish improvement in wages have kept some of them sidelined in the market.
A new down payment assistance program opened recently can pave the way for these buyers stymied by a limited budget. A fresh infusion of funds amounting to $650,000 from the State Housing Initiatives Partnership Program made the down payment assistance facility possible. To educate local realtors and lenders about this facility, a workshop was conducted in August by the joint city and county Office of Housing and Community Development.
The assistance applies to purchases of new and existing single family homes and condos, with up to $30,000 available to applicants who qualify under the program’s terms and conditions. One basic requirement is that the residence up for purchase should be located in Sarasota County, and the buyer agrees to use the home as primary residence. When the property is no longer owner-occupied, repayment would be required on the principal and on a certain portion of any net appreciation. This same requirement applies when the property is sold or transferred.
Another eligibility requirement provides that the purchase and appraised value should not exceed $175,000. Also, the buyer must contribute at least 3% of the purchase price including prepaid expenses and closing costs. The ceiling of prepaids and closing costs paid through the program has been set at $4,375.
Also prior to receiving assistance, the applicant must attend an eight-hour Community Homebuyer Class approved by the Department of Housing and Urban Development. The applicant’s income should not be more than 80% of the median income adjusted to household size. The households covered start from those having $32,100 income and up.
A significant number of aspiring home buyers from low-income households in Sarasota, along with those in neighboring Bradenton and Venice, are theoretically eligible for the down payment assistance. A new report by the U.S. Conference of Mayors showed that 27% of households in the Bradenton-Sarasota-Venice area have a median income of $25,000 to $49,999, a level well within the program’s cutoff requirement.
The same report indicated that although the employment situation has improved significantly since the Great Recession with more job opportunities becoming available recently, Americans are making on average 23% less at those new jobs than they were before the economic downturn. The study also pointed out that the wage decrease adversely affected the lower-income households disproportionately compared to other income groups. This makes the down payment facility truly valuable under prevailing circumstances in the labor front.
There are a lot of buying opportunities of resale homes around the $175,000 maximum price eligible under the Sarasota down payment assistance program.
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