values in New Mexico surged by 36%, surpassing the national increase of 33%. One of the most significant barriers to homeownership is saving for a down payment, especially for high-priced homes. To avoid mortgage insurance, households must save a down payment ranging from at least $20,000 in the counties with lower median prices up to over $50,000 in more urban places, and around $80,000 or more in Santa Fe and Los Alamos. To address this issue, the New Mexico MFA developed and implemented the Down Payment Advantage program. This program provided a first come, first served grant of $25,000 to eligible low-income, firsttime homebuyers, which could be used in conjunction with the FirstHome loan. The grant assisted with the minimum down payment, closing costs (including pre-paid items) and, in some cases, an additional principal reduction payment on the first mortgage loan. Borrowers had the option to combine the grant with other down payment assistance programs offered by MFA, resulting in a maximum of $35,000 in funding. The $25,000 was provided without the requirement of repayment to MFA by the homeowner. However, if the borrower utilized other down payment loan options, such as FirstDown Down Payment Assistance or HomeNow Down Payment Assistance, the loan amount would become due upon sale, transfer or refinance. The program proved to be highly successful and provided a total of $7.6 million in funding and assisted 304 New Mexicans in achieving homeownership. Homeownership is widely recognized as one of the most effective means of building wealth, enabling families to accumulate assets, supporting retirement and passing on generational wealth. Access to homeownership is also paramount for economic stability by protecting against inflation and involuntary displacement. The combination of rising home values, inadequate income growth and increased rents has created an unstable and challenging housing market for New Mexicans. However, MFA aims to serve as a resource to the community and minimize these barriers through programs like the Down Payment Advantage and other homeowner assistance programs. The lack of housing stability not only interferes with a household’s self-sufficiency and their ability to pursue economic mobility for their families but also has adverse effects on state and local economic development and growth. 23
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