Newsletter: May 2024

I hope you’re all doing well. Hard to believe we’re at the end of May, and as we continue moving through this year, I’m hearing mixed reports about the state of the housing market. Some agents are still seeing robust activity, while others are experiencing a noticeable slowdown. Has your market activity slowed down, or are you still seeing strong engagement? I’d sure like to know.

One thing I do know for sure is that in any type of market, you, as a real estate agent, are always seeking ways to assist your clients in achieving their dream of homeownership. And today, I wanted to talk about one overlooked avenue that can help many families achieve financial stability and long-term security through homeownership.

What is it, you ask?

Well, it may come as a surprise, but it’s worth utilizing, and that’s the Section 8 Housing Program.

Seriously, you ask? YES, I say!

I know, I know, Section 8 Housing Choice Vouchers have traditionally been used for rental assistance. But hear me out. They can also be a powerful tool for low-income families looking to buy a home.

The program allows eligible voucher holders to use their housing assistance payments towards mortgage and homeownership expenses, rather than rent, giving them a means to invest in property instead of temporary housing. It’s a way for them to set down roots and become a permanent part of a community. Now, that’s a plus!

So, how does it work?

• It’s counted as income, and since it’s not taxed, it can be grossed up!

For example, if you have a client on Social Security income receiving $1,200 per month, FHA allows you to gross that income up by 15%, and Fannie and Freddie allow you to gross up by 25%. Then, you add the Section 8 voucher and gross it up by the same standard.

Income: $1,200.00

Grossed up 15% = $1,380.00

Section 8 voucher: $1,000

Grossed up 15% = $1,150.00

Total qualifying income: $2,530.00

Okay, right about now, I hear you groan. I get it. But I believe with patience and the determination to get it done, the benefits can be tremendous. Here’s just a few:

  • Equity and Stability: Homeownership allows families to build equity over time, gaining financial stability and the potential for wealth accumulation. Instead of paying rent, they make payments towards owning a tangible asset.
  • Predictable Monthly Payments: Homeowners can avoid rent increases with a fixed-note mortgage that gives them a payment that’s not subject to change.
  • Community Investment: Owning a home leads to a greater sense of community and personal investment in the neighborhood. Families are more likely to engage in local activities, maintain their properties, and contribute to the well-being of their communities.
  • PLUS and here is a BIG PLUS: Many of these home buyers will qualify for additional down payment assistance outside of THDA and USDA. Making home ownership more affordable for them.

These are some pretty good benefits, right?

By utilizing the Section 8 Housing Program, there’s a big opportunity to serve more families. They’ll undergo a huge transformation because they’ll go from being renters to owning their own home. In the end, you’ll be the real hero because you helped them take advantage of an underutilized resource to achieve their dream of homeownership.

Now, who doesn’t want to be a hero?

If you’d like to explore this some more, or even if you have a few questions, give me a call. The number is (865) 745-5626.

Here’s to all the heroes helping families!

And…as always…let’s mortgage!

John Fleming, Jr.
Preferred Rate
Loan Originator | NMLS 1850409
(865) 745-5626

P.S. My goal is to assist homebuyers in any way I can through education, communication and good old fashioned customer service. No matter what, I’ll help them find the best option available. Send them my way. The number is (865) 745-5626.

Food For Thought:

Housing authorities predict that by the year 2026 the average price of a home in the Knoxville area will be just under $420,000. Even though the focus remains on affordable housing, rising home values can certainly lead to a monster of a market just like the ones that have already consumed places like California and New York. That’s definitely disappointing, but the good news is that right now homebuyers can still secure a mortgage that’s right for them. And I’m committed to help. Call me at (865) 745-5626 to discuss options.


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