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Government Grants for Housing Rare But Possible

brick buildings funded by government housing grants

As we've said often on this site, government grants for housing are really, really rare. The word grant implies that you don’t have to repay the money, in contrast with a loan. Other forms of housing subsidy are much more common.

We're sorry to say that this page is totally U.S. centered. Governments worldwide provide many types of housing grants, subsidies, and incentives; such grants are more prevalent in Europe, for instance, than in the U.S., by a wide margin.

During the Great Recession we enjoyed some exceptions to that rule in the form of federal tax credits that have now expired. You could check to see if your state or local government is still offering first-time homebuyer credits or other incentives.

Another type of assistance that will not have to be repaid may come in the form of disaster relief, for victims of hurricanes or earthquakes.

But in ordinary situations and economic times, government grants for housing come with strings attached. The location or condition of the housing unit, your income or situation in life, or the home having been in foreclosure or forfeited for non-payment of taxes might  qualify you for some taxpayer assistance.

One common program is the provision of non-repayable grants to help households assemble a down payment. 

The HOME program was enacted in 2003 to furnish down payment assistance for home purchase, and from time to time, there are other down payment assistance programs at federal, state, or local levels. For information on HOME, call 1-800-998-9999.

State and local jurisdictions administer this program, and program rules are inconsistent from place to place, and from time to time.

Public Housing: The Most Common Exception to Our Warning That There Is No Grant Money

The longstanding exception to the rule of thumb that there are no such things as government grants is public housing itself, which essentially comes in two forms in the U.S.:

1. Public housing where a local housing authority provides housing in complexes or at scattered locations throughout the community, with the rental payment capped at 30% of household income, no matter how low, and

2. Housing Choice Vouchers that let tenants find their own housing if they find a landlord that will work within government guidelines.

To learn how these programs operate, contact a local agency called the "housing authority."  In spite of the fact that the dollars behind these programs are federal funds, the administration is local.  Cities and counties are allowed to decide whether to form housing authorities, so an urbanized county could conceivably have a county housing authority and one or more municipal housing authorities operating within its boundaries.

Possible State and Local Funding Sources

Lastly, please check with your local city or county government. Many of them used their federal Neighborhood Stabilization Program money to provide actual grants to people purchasing foreclosures, but that program is closed almost everywhere. From time to time, a local government may offer first-time homebuyer grants anyway.

Conceivably, some local governments offer grants to particular income levels or in specific neighborhoods through their regular Community Development Block Grant program. Tax forfeiture properties are available for purchase from a county government, usually for very modest prices, or even $1 in the occasional aggressive program.

It's also worth checking into whether any local land banks offer discounted housing. Many of these entities are non-profit corporations of some type rather than governments as such.

Learning More About Government Grants for Housing

Never pay for information about government grants for housing, and don't trust a commercial website more than you trust the government agency. Unfortunately, sometimes federal, state, and local governments let their website information grow stale, so a phone inquiry is always best after you've done a little background checking on the Internet.

For any non-tax federal program we refer to, call the Department of Housing and Urban Development at 800-569-4287 or 888-995-4673. Click the link to locate most state housing agencies.

On this page, we confined ourselves to these few opportunities for government grants for housing. For a much more complete overview of the many ways that governments at various levels might subsidize your purchase of a home or your rent through making loans more affordable, offering free or low-interest loans for home repairs, and so forth, please see the much longer page on government housing assistance in general.

Affordable Housing Options:

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