Is goverment price control property a good buy?

6 Replies

In Maryland the county I live in offer Workforce Housing program. Property in metropolitan area for the somewhat low income (income<$102k=qualified). The kickers are: its sold at discounted price, and remains the same for 20yrs. Refinance is allowed but not more than the controlled resale price established by the county. If its sold within 20yrs it has to be sold for no more than the established price by the county. The property can not be rented out, owner must occupy. Also there will be asset limitation: one can not have asset exceeding 75% of the amount of loan (i think this means one cant buy more properties).

Does this sound like a good deal for first time home buyer?

You can typically buy a pretty nice house for very cheap.  So it can be good to buy a place for the enjoyment aspect of it, its just not a good investment.

Originally posted by @Jordan Yefriadi :

@Russell Brazil it’s not a good short term investment? In 20yrs it will match market value tho. In that perspective it’s a good long investment right?

 Are you realistically going to live in it for 20 years?  They typically have rental restrictions, so you cant rent them out.  The average person moves every 7 years.  

@Jordan Yefriadi That’s an extreme amount of limitations. 20 years! Also they’re monitoring your assets during the 20 years! Wow that property must be really cheap! Is the value cap reviewed and adjusted year by year or do they advise you now on what your cap is over the next 20 years? If it isn’t at least 2-3% appreciation per year, I’d vote no deal.

I’d prefer my freedom to reach the peaks of my investment potential. Also you are very unlikely to live there 20 years? Are you married?