As affordability eroded, due to higher mortgage rates and record-high home prices, downpayment assistance programs flourished during 2023, increasing 6% compared with 2022, according to Down Payment Resource.
A total of 135 new homebuyer assistance programs were introduced during the year, according to the firm, which serves as the housing industry’s authority on homebuyer assistance program data and solutions.
There are now 2,294 homebuyer assistance programs supported by housing agencies nationwide, according to DPR.
The growth occurred during a year when home affordability hit a nearly four-decade low.
“As the housing market grappled with historic affordability challenges in 2023, our HPI report reveals a critical response: the introduction of 135 innovative homebuyer assistance programs — a six-percent increase over the previous year,” says Rob Chrane, founder and CEO of DPR, in a statement. “This surge in programs, which now totals 2,294 nationwide, represents a concerted effort by housing agencies to expand opportunities and break down barriers to homeownership. With a significant increase in programs for manufactured homes, multi-family properties, and specific buyer demographics like service members and Native Americans, this year’s report underscores a growing commitment to diversify housing solutions and empower a broader spectrum of aspiring homeowners.”
Of the existing 2,294 homebuyer assistance programs currently active, 804 allow for the purchase of a manufactured home, up 20% from 2022.
Housing agencies are expanding program eligibility to include more property types, DPR says. Manufactured housing has a lower entry point than other types of homes and is helping many buyers get their foot in the door. DPR expects to see the number of programs that allow for manufactured housing continue to grow.
Of the programs active January 8, 686 allow for the purchase of a multi-family property, up 8% from the previous year.
Using DPA to purchase a multi-family property has become increasingly popular, the firm says. This allows people to become homebuyers as well as investors — a strategy that has been called “house hacking” in recent years.
Photo: Ian MacDonald