The housing market is already flourishing, yet with the introduction of new legislation geared toward first-time homebuyers, the Triangle market will soon see a massive influx of potential buyers looking to take advantage of tax credits that will open doors to home ownership.
The Biden Administration introduced new legislation in April called the “First-Time Homebuyer Act,” which provides a tax credit of up to 10% of the purchase price, or $15,000. To be eligible, a buyer must not have purchased or owned a home within the past three years. This money may be available to the buyer at closing, which can be applied to a down payment or even closing costs.
According to a Triangle MLS report from March of 2021, the median sales price across the entire Raleigh-Durham area has been approximately $306,000 for 2021. A $15,000 tax credit up front would give a potential buyer well within the minimum of a 3.5% down payment on a home at that price.
In addition, a proposed Down Payment Toward Equity Act of 2021, if approved, will expand tax credits of up to $25,000 for a down payment for first-time, first-generation homeowners. And the state of North Carolina also offers the NC Home Advantage Mortgage, which could offer down payment assistance as well. With so many opportunities, it’s expected these programs will bring in a new generation of homeowners and continue to boost an already outstanding market. In fact, a report from Zillow shows approximately 28% of renters in Raleigh alone could be eligible to become homeowners.
The First-Time Homebuyer Act was introduced by United States Rep. Earl Blumenauer (D-OR) and Rep. Jimmy Panetta (D-CA), while the Down Payment Toward Equity Act is led by Rep. Maxine Waters (D-CA). The goal of these programs, according to Blumenauer, is to help keep housing affordable and to combat historic, discriminatory housing policies.
Thinking about buying or selling a home? Check out this list of local professionals with the Jim Allen Group.
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