“For sale” and “sold” signs have sprouted like springtime flowers across our communities. At the end of April, the 52nd annual Parade of Homes will present 65 homes newly constructed by Home Builders Association of F-M members. It’s no coincidence that activity is strong: Low interest rates and housing availability combine with wonderful local incentives to provide area residents many ways to make a homeownership dream come true.
Note: the information below encompasses Dilworth, Fargo, Moorhead and West Fargo. If unlisted, contact your local jurisdiction for more details on specific incentives it may offer.
Tax incentives on new construction
The cities of Fargo and West Fargo offer a two-year tax exemption on new construction that offers thousands of dollars in savings for buyers. The law was updated in 2009 to offer more benefit for home buyers, increase home sales and strengthen a struggling housing market. The improved incentive offers a $150,000 value reduction off building value for two full years to owners of a newly constructed home. This amounts up to a $2,600 per year savings on property taxes, totaling up to $5,200 in savings.
The incentive is available to all jurisdictions in North Dakota due to legislation, S.B. 2247, passed during the 2009 legislation session. The bill doubled the amount of value available from $75,000 to $150,000. The bill also clarified the language to guarantee every qualifying home buyer two full years of benefit. The original bill and value amount were first established in 1983.
“These tax exemption programs in our communities are an incredible deal for home buyers,” said Bryce Johnson, Home Builders Association of F-M executive vice president. “The incentives go a long way to increase home buying activity and help keep the housing industry a robust part of the local economy.”
2012 Home Builders Association of F-M President Terry Becker, Terry Becker Construction, LLC, echoes that sentiment, “The incentives give Realtors a tool that is easy to understand when using it to sell a home, and they give new homeowners an incentive to buy. It provides a little break during a time when costs are the highest.”
Home buyers can get down-payment, closing cost, financing assistance
Home buyer assistance through state and local governments comes in many different forms. Here is a quick rundown of what is available:
Zero interest, deferred payment loans are available in North Dakota through the North Dakota Housing Finance Agency’s Down Payment and Closing Cost Assistance Program aim to help lower-income first-time home buyers meet their out-of-pocket cash requirements. The home buyer may be eligible to receive the greater of 3 percent of the purchase price of the home or $3,000.
Closing Cost Assistance Program home buyers must be receiving their first mortgage loan from NDHFA, and have a minimum of a $500 out-of-pocket investment. Borrowers must meet the program’s income limits, which vary based on county and family size, and they should meet the normal credit underwriting standards. The purchase price of the property must be within program limits.
For more information visit www.ndhfa.org or contact a participating lender.
Minnesota Housing program first-time buyer programs are available to eligible buyers in Moorhead and Dilworth. The state of Minnesota’s programs give home buyers some choices for assistance. Several options exist for down-payment/closing-cost assistance and mortgage financing, depending on income and borrower eligibility.
Moorhead Neighborhood Services Manager Lisa Vatnsdal says that there are a number of area lenders who participate in below-market interest rate mortgages through Minnesota Housing programs, including Community Activity Set Aside, or CASA, and Minnesota Mortgage Program. Moorhead buyers may also qualify for zero-interest deferred down payment and closing-cost loan assistance programs called Homeownership Assistance Fund (HAF) and Home Help.
Even more resources are targeted to Moorhead’s Stonemill Ponds neighborhood; no interest affordability gap loans and special assessment financing are available for qualified first-time home buyers.
Vatnsdal says, “Up to $44,500 may be available to assist eligible home buyers purchase a newly constructed home in this neighborhood.”
Did you know?
Today’s interest rates could get you a $280,000 mortgage for monthly payments that are less than a $100,000 mortgage in 1981*?
Average interest per decade:
- 2000s 6.3 percent
- 1990s 8.1 percent
- 1980s 12.7 percent
- 1970s 9 percent
*Interest rates peaked Oct. 1981 at 18.45 percent