South Dakota Housing launches homebuying assistance program for recent grads

Houses under construction. (Getty Images)

South Dakota Housing will launch its Grants for Grads program Friday, aiming to help college and technical-college graduates purchase their first home in South Dakota. The program is available “for a limited time.”

The program existed under former Gov. Dennis Daugaard’s administration in an effort to attract workers to the state, but ended in 2019, South Dakota Housing Director of Homeownership Programs Brent Adney told board members on Thursday.

“I wouldn’t be surprised if we had quite a few commitments right away,” Adney said.

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The timing is good, added Director of South Dakota Housing Chas Olson, and it’ll help first-time homebuyers enter the market.

Average first-time homebuyers can expect to spend about two-fifths of their pre-tax income on a monthly payment for a house in South Dakota, according to Dakota Institute research .

“Any kind of affordability relief we could provide is good at this time,” Olson told board members.

The program will also help with South Dakota’s workforce development initiatives, added Housing Development Authority Board President Scott Erickson.

“If someone graduated three years ago, moved to a major city and found that housing is really expensive, it would be the draw to bring them back,” Erickson said.

First-time homebuyers will be eligible if they’ve earned a degree from an accredited university or technical college in the last five years, select a South Dakota home costing $385,000 or less, and meet income requirements . According to Zillow , the median home sale price in South Dakota is $290,833.

Materials from the prior iteration of Grants for Grads said the program provided 5% percent of a participant’s loan amount as a grant to be used for a down payment or closing cost assistance.

Interested participants must contact a lender to set an appointment and apply for the program.

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