First time home buyers or folks who haven’t owned a home in the past three years should be jumping up and down now that the $20,000 has been authorized/released from the State Legislature for qualified buyers. BUT it’s not as wonderful as it seems.

First, only 2,400 qualified homebuyers will be able to get the funds through the First-time Homebuyer Assistance Program.

Second, you can’t buy a home that costs over $450,000.

Third, and this is a biggie…you can only buy NEW CONSTRUCTION.   This last requirement was lobbied by developers and may not help that many people wanting to live in certain areas. There’s very little new affordable construction going on in rural areas of the state, and almost none close-in to downtown Salt Lake City except for a few townhomes. When searching the WFRMLS for new construction properties in the Salt Lake Valley, a whopping 37 show up under $450,000 and all are townhomes. Townhomes may be great for some, but often they have many stairs so that differently abled persons and seniors could not buy one. Utah County had 74 properties with only two home subdivisions (not townhomes) in Eagle Mountain and Spanish Fork. Davis County had a mere 9 available, again, all townhomes. Washington County also had 9 properties, mostly townhomes, with a few one level homes available in Hurricane. Summit County has NO properties that fit the requirements and Wasatch County has one newly constructed home in Daniel for $160,000. Many builders do NOT list their properties on an MLS and so buyers have to drive around or hunt and peck on the interweb to find other options.

Townhomes are similar to condos in that some have HOA fees for exterior insurance, water, sewer and grounds maintenance. Depending on the subdivision you may or may not own the land underneath the unit. They are a great housing alternative for some because they are an affordable option for some and offer a ‘lock and leave lifestyle’ if the exterior landscaping is paid for in a monthly fee. The most common floorplan is living space above a two car garage, with the second level the kitchen, great room and probably a half bath, and laundry and the rest of the bedrooms/ baths on the second floor.

IF you think you’ve found housing that fits the rules for the program, your first step is to get pre-approved with a participating lender to get credit-qualified. The $20K loan is 0% interest with no monthly payments and can be used toward the down payment and/or closing costs. When you refinance or sell the property you have to repay the amount borrowed OR 50% of the home equity.

For more information, contact a local mortgage broker who can qualify you and spell out the numbers for you for a loan. I don’t suggest internet brokers as they may not be familiar with the program. And check out utahhousing.org.