Getting your player ready...
Five years ago when the market was in the tank, the national media carried stories that the Millennial Generation (now aged 18-34) wasn’t buying into the American dream of homeownership as much as older generations had. Now numerous studies show that to be nonsense: Millennials haven’t bought because they haven’t had the income and down payments to do so. Here in Denver, with rents rising at the second-fastest rate in the U.S., a bright job picture is allowing young buyers to get on the homeownership track; maybe with a little help, something that CHFA has provided 84,000 Colorado buyers since 1974.
How do you get out of renting and into owning if you don’t have the resources? You can go to the Bank of Mom & Dad, or you can go to CHFA – the Colorado Housing and Finance Authority – with a range of options for buyers who want to own and need a little help. “We’re really glad we did that,” says Veronica Zio, 25, who with her fiancé John Zayac closed on a house in Southeast last month, after being pre-qualified by American Financing, using some CHFA backed programs. Could they have made it without that, using money they had saved? “It would have been really, really hard,” Zio says.
“You may not have enough down or you may need closing cost assistance,” says CHFA Director of Home Finance Dan McMahon. Using CHFA, he adds, a lender can create a package of options for a specific buyer – using, say, a Down Payment Assistance Grant, for as much as 3% of the loan amount. (It doesn’t need to be paid back.)
CHFA knows the housing market is daunting now, with Denver’s low inventory of homes. “What we hear is buyers are having to put seven or eight bids on properties to get a contract, almost like an auction,” McMahon says. But for those willing to swim in those faster waters, CHFA is making it happen – on track for a record production year, and with 55% of its assistance headed for millennials like Zayac and Zio.
The couple toured 30 houses and made six offers before landing a keeper; but to the sellers, CHFA’s involvement was largely invisible. Zayac and Zio were well prepared for the action from an online class they took – a minimal charge that can be wrapped into a loan. (In-person classes are free; there’s a list of providers at CHFAinfo.com).
Now Zayac and Zio are painting and fixing up their place, using some of their savings they didn’t put into the purchase, thanks to CHFA. Would they have been better off to wait a year, when they’d saved more? Absolutely not, says a study by Realtor.com – citing the costs of postponing in 101 national housing markets. Here in Denver-Aurora-Lakewood, the study says, the net from purchasing now, projected over 30 years, is estimated at $696,131 – while the cost of waiting even a single year is pegged over $26,000; $88,000 to wait three years.
Meanwhile, all of the reasons not to buy a home are evaporating as Colorado moves into faster growth. Even many buyers who were upside-down on mortgages a few years back are seeing fast appreciation that erases the red ink and puts them into the black. “It was a myth that Millennials don’t want to own stuff,” says Gene Myers, CEO of New Town Builders, with millennial kids of his own. “These are buyers that have had to postpone their lives because they got out of school at a difficult time. Now they’re hopping around West Highlands and other neighborhoods, trying to find what they can afford.”
CHFA can get the ball rolling: “It’s important and to get educated and preapproved,” says CHFA’s McMahon. And you don’t need to be a Millennial to qualify (McMahon recalls a recent loan to a couple in their eighties). CHFA is on the web at CHFAinfo.com, where you’ll find a Facebook contest for a $500 gift card, launching next week, celebrating Down Payment Assistance Grants: ‘What freedom would you grant yourself with homeownership?’
WHERE: CHFA, Colorado Housing and Finance Authority, record of helping more than 84,000 buyers achieve homeownership. Newest programs are available to non-first-time buyers, as well. Ask a participating lender about CHFA Down Payment Assistance Grants
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PHONE: 303-297-CHFA
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