Local Government Assistance - A New Trend?

We have all heard of builders throwing in incentives when buying a home, and we are now hearing too much about the federal government having to get involved as well. What’s next? I am starting to see a trend of local municipalities entering the incentive ring in an effort to stimulate housing sales and growth locally.

I first heard of this last month when the village of Manhattan, IL, began offering incentives for new construction, and now the local government of Harrisburg, PA is doling out $1,000,000 to help first-time home buyers.

In Manhattan, if you buy a single family, new construction home before July 2009, you can qualify for a rebate for up to $5,000. If you buy a town home or condo, you’ll receive a $3,500 rebate. The rebates will be financed through developer-paid building permits. According to Tom Pahnke, the town’s building commissioner, the plan provides not only local stimulus, but also keeps community wide assessed property values higher than if the builders had to slash prices. You can see the list of preferred builders (however, it is not necessary to use one of them, any new construction qualifies) and read more of the details at www.BuildManhattan.com.

In Harrisburg, first-time home buyers are the targets. If you are buying your first home, you can qualify for up to $5,000 in down payment assistance and closing cost aid. The Harrisburg city council actually allotted $2,500,000 to housing issues, with the remaining $1,500,000 going towards programs such as emergency shelters, demolition of blighted structures, and other charitable housing causes.

Between the sellers, builders, local, state, and federal government programs - there are many assistance programs out there. Make sure you do all your due diligence before going to the closing table.