Friday, January 21, 2011
Texas releases $45 million more for first-time homebuyer tax credit
The Texas Department of Housing and Community Affairs recently made available a second round of funding for its first-time homebuyer tax credit program under its Texas Mortgage Credit Program.
The state agency just released $45 million of $500 million allocated for the program. The department released $50 million of the funds in May when the program was first implemented.
“Despite all the negatives we hear from other states, the fact is that the Texas economy — and the demand for homeownership — both remain quite healthy,” said Michael Gerber, executive director of the Texas agency. “Many families want and are ready to take that exciting step toward homeownership."
The Texas Mortgage Tax Program was the state's response to the expiration of the federal tax credit in April 2010, and is the single largest financing initiative for state homebuyers in the 27-year history of the tax program. The program is funded through a bond program, however, no one at the agency was immediately available to provide details concerning funding.
The program is designed to make housing more affordable to low- to middle-income Texas families who have not lived in a home for three years by offering borrowers a tax liability reduction. According to the agency, a borrower can receive a tax credit up to $2,000 annually, depending on which of two mortgage loan options they decide to take advantage of.
The first is an assisted loan option. Under this option, a borrower receives a 5.74% interest rate on a 30-year, fixed-rate mortgage, along with payment assistance on the down payment and closing costs up to 5% of the principal amount. This 5% assistance comes in the form of a 30-year repayable second-lien loan.
The second option is an unassisted loan, in which case the borrower receives a 30-year FRM at a 4.99% interest rate. State funds do not help with down payments or closing costs.
The benefit lasts throughout the life of the loan.
A borrower is required to take a homebuyer education class in order to qualify for the tax break. Homebuyer education is arguably one of the most important steps to homeowner sustainability, according to Marietta Rodriguez, national director for National Homeownership and Lending at NeighborWorks America.
"We believe strongly in pre-purchase homebuyer education before a mortgage product is selected," Rodriguez said in an interview, adding that the industry, and especially the government-sponsored enterprises, have shied away from this strategy recently.
"With that action, Fannie and Freddie are sending a message to the industry that counseling doesn't matter and that has strong ramifications on the industry as a whole."
Texans interested in the program must be earning up to 115% of the area median family income. For residents living in specific targeted areas of the state, such as places impacted by natural disaster, households may earn up to 140% of the average median income in the area and still qualify. In these cases, the first-time homebuyer requirement is waived.
Credit is available through the Federal Housing Administration, the Department of Veteran Affairs, the U.S. Department of Agriculture or one of many participating conventional mortgage lenders throughout the state.
“The Texas Mortgage Credit Program is another helpful yet responsible tool that TDHCA can offer to qualifying Texas families who are prepared to be homeowners,” said Gerber. “If you are ready to take that step toward homeownership, the state is ready to help you.”
Write to Christine Ricciardi.
The state agency just released $45 million of $500 million allocated for the program. The department released $50 million of the funds in May when the program was first implemented.
“Despite all the negatives we hear from other states, the fact is that the Texas economy — and the demand for homeownership — both remain quite healthy,” said Michael Gerber, executive director of the Texas agency. “Many families want and are ready to take that exciting step toward homeownership."
The Texas Mortgage Tax Program was the state's response to the expiration of the federal tax credit in April 2010, and is the single largest financing initiative for state homebuyers in the 27-year history of the tax program. The program is funded through a bond program, however, no one at the agency was immediately available to provide details concerning funding.
The program is designed to make housing more affordable to low- to middle-income Texas families who have not lived in a home for three years by offering borrowers a tax liability reduction. According to the agency, a borrower can receive a tax credit up to $2,000 annually, depending on which of two mortgage loan options they decide to take advantage of.
The first is an assisted loan option. Under this option, a borrower receives a 5.74% interest rate on a 30-year, fixed-rate mortgage, along with payment assistance on the down payment and closing costs up to 5% of the principal amount. This 5% assistance comes in the form of a 30-year repayable second-lien loan.
The second option is an unassisted loan, in which case the borrower receives a 30-year FRM at a 4.99% interest rate. State funds do not help with down payments or closing costs.
The benefit lasts throughout the life of the loan.
A borrower is required to take a homebuyer education class in order to qualify for the tax break. Homebuyer education is arguably one of the most important steps to homeowner sustainability, according to Marietta Rodriguez, national director for National Homeownership and Lending at NeighborWorks America.
"We believe strongly in pre-purchase homebuyer education before a mortgage product is selected," Rodriguez said in an interview, adding that the industry, and especially the government-sponsored enterprises, have shied away from this strategy recently.
"With that action, Fannie and Freddie are sending a message to the industry that counseling doesn't matter and that has strong ramifications on the industry as a whole."
Texans interested in the program must be earning up to 115% of the area median family income. For residents living in specific targeted areas of the state, such as places impacted by natural disaster, households may earn up to 140% of the average median income in the area and still qualify. In these cases, the first-time homebuyer requirement is waived.
Credit is available through the Federal Housing Administration, the Department of Veteran Affairs, the U.S. Department of Agriculture or one of many participating conventional mortgage lenders throughout the state.
“The Texas Mortgage Credit Program is another helpful yet responsible tool that TDHCA can offer to qualifying Texas families who are prepared to be homeowners,” said Gerber. “If you are ready to take that step toward homeownership, the state is ready to help you.”
Write to Christine Ricciardi.
Pricier houses’ sale and price gains drive up Dallas’ median sales price for 2010, but market for most homes fell
Pricier houses’ sale and price gains drive up Dallas’ median sales price for 2010, but market for most homes fell
Photo: DMN/Staff
INCLUDEPICTURE "http://www.dallasnews.com/skins/dmn/gfx/pixel.png" \* MERGEFORMATINET
By STEVE BROWN
Real Estate Editor
Published 20 January 2011 08:24 PM
More on this story
· See map of local area home sales
If you just go by the numbers, 2010 was a good year for Dallas-area home prices.
The median price of area homes sold by real estate agents rose 4 percent from a year earlier, according to Multiple Listing Service reports.
But the increase in home prices had more to do with what kind of homes folks bought last year — more expensive houses and fewer modest homes, a closer look at the numbers shows.
“Activity slowed much more dramatically at the entry-level price points than in the upper-level price points in the post-tax credit era,” said Ted Wilson of Dallas-based housing analyst Residential Strategies. “Thus, with lower activity on the entry level and increased activity at the higher prices, the median price has shifted higher.”
Wilson said home sales prices in most areas actually “inched lower” in 2010.
“This is not surprising since the inventory of homes for sale increased after the tax credit expired,” he said. “Excess inventory in any industry usually leads to some discounting or price reduction.”
But you can’t tell that by just looking at the price maps.
Median home prices were higher in 29 of the 46 Dallas-area residential districts The Dallas Morning News tracks each quarter. The data to make the comparisons comes from the Real Estate Center at Texas A&M University and North Texas Real Estate Information Systems.
Across the area, sales of houses priced at $250,000 and above rose 3.4 percent from a year ago, sales data shows, while purchases of more modest properties declined about 13 percent.
“Yes, no doubt some of the increases in overall price levels are attributable to the rebound in middle and upper-end market and decline in lower-end, first-time market,” said Dr. James Gaines, an economist with the Real Estate Center.
Gaines said that home values in North Texas are taking a hit from foreclosures, which were at record levels in 2010.
“What we’re seeing is that nondistressed home sales are trending up in value at just under ‘normal’ rates of increase, but the distressed sales — as best we can identify them — are falling in prices,” he said.
The biggest price declines last year were in areas with lots of home foreclosures, including Cedar Hill, Oak Cliff , Garland and Northwest Dallas.
Home sales numbers for 2010 are easier to figure out.
The number of pre-owned home purchases dropped in almost every area.
The only neighborhoods that saw significant increases in home sales were pricey districts where monied buyers were snapping up bargains.
Home sales jumped 30 percent in North Dallas, 29 percent in the Park Cities and 23 percent in Westlake-Trophy Club compared with 2009.
For all of the Dallas area, sales of pre-owned single-family homes fell about 8 percent in 2010 from 2009
LINK TO ARTICLE: http://www.dallasnews.com/business/headlines/20110120-pricier-houses’-sale-and-price-gains-drive-up-dallas’-median-sales-price-for-2010-but-market-for-most-homes-fell.ece
LINK TO INTERACTIVE MAP: http://www.dallasnews.com/business/area-home-sales/index.jsp
Photo: DMN/Staff
INCLUDEPICTURE "http://www.dallasnews.com/skins/dmn/gfx/pixel.png" \* MERGEFORMATINET
By STEVE BROWN
Real Estate Editor
Published 20 January 2011 08:24 PM
· See map of local area home sales
If you just go by the numbers, 2010 was a good year for Dallas-area home prices.
The median price of area homes sold by real estate agents rose 4 percent from a year earlier, according to Multiple Listing Service reports.
But the increase in home prices had more to do with what kind of homes folks bought last year — more expensive houses and fewer modest homes, a closer look at the numbers shows.
“Activity slowed much more dramatically at the entry-level price points than in the upper-level price points in the post-tax credit era,” said Ted Wilson of Dallas-based housing analyst Residential Strategies. “Thus, with lower activity on the entry level and increased activity at the higher prices, the median price has shifted higher.”
Wilson said home sales prices in most areas actually “inched lower” in 2010.
“This is not surprising since the inventory of homes for sale increased after the tax credit expired,” he said. “Excess inventory in any industry usually leads to some discounting or price reduction.”
But you can’t tell that by just looking at the price maps.
Median home prices were higher in 29 of the 46 Dallas-area residential districts The Dallas Morning News tracks each quarter. The data to make the comparisons comes from the Real Estate Center at Texas A&M University and North Texas Real Estate Information Systems.
Across the area, sales of houses priced at $250,000 and above rose 3.4 percent from a year ago, sales data shows, while purchases of more modest properties declined about 13 percent.
“Yes, no doubt some of the increases in overall price levels are attributable to the rebound in middle and upper-end market and decline in lower-end, first-time market,” said Dr. James Gaines, an economist with the Real Estate Center.
Gaines said that home values in North Texas are taking a hit from foreclosures, which were at record levels in 2010.
“What we’re seeing is that nondistressed home sales are trending up in value at just under ‘normal’ rates of increase, but the distressed sales — as best we can identify them — are falling in prices,” he said.
The biggest price declines last year were in areas with lots of home foreclosures, including Cedar Hill, Oak Cliff , Garland and Northwest Dallas.
Home sales numbers for 2010 are easier to figure out.
The number of pre-owned home purchases dropped in almost every area.
The only neighborhoods that saw significant increases in home sales were pricey districts where monied buyers were snapping up bargains.
Home sales jumped 30 percent in North Dallas, 29 percent in the Park Cities and 23 percent in Westlake-Trophy Club compared with 2009.
For all of the Dallas area, sales of pre-owned single-family homes fell about 8 percent in 2010 from 2009
LINK TO ARTICLE: http://www.dallasnews.com/business/headlines/20110120-pricier-houses’-sale-and-price-gains-drive-up-dallas’-median-sales-price-for-2010-but-market-for-most-homes-fell.ece
LINK TO INTERACTIVE MAP: http://www.dallasnews.com/business/area-home-sales/index.jsp
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