The southwestern Kansas housing market may benefit from a small portion of the Farm Bill signed into law Friday. The trillion-dollar piece of legislation that is largely associated with agriculture also has something to say about who gets USDA home loans in rural America.
It used to be that Dodge City, Garden City and Liberal were not considered rural enough to qualify for USDA home loan programs according to federal standards. These are the loans that often help young adult buyers who have good credit but not much cash buy their first home.
The housing market in southwestern Kansas has been tight, keeping the young professionals that many cities, schools and other employers wish to attract stuck with high rent prices rather than affordable home ownership.
Some prospective home owners were drawn to rural areas just outside of city limits, where the loans have been available.
In 2012, a so-called Southwest Kansas Coalition of lawmakers formed to rally for a change to the definition of a rural area according to the federal government, according to the Dodge City Daily Globe. These provisions survived changes to the Farm Bill signed into law Friday.
Now, under the rural home lending assistance program, homebuyers in Dodge City, Garden City and Liberal can get a loan for the entire cost of the property, rather than coming up with a down payment.
A renewal to the first time homebuyer program was also signed into law last week, allowing buyers to get four percent of the loan cost toward a down payment and closing costs.
Not only will it be easier for young homebuyers to get homes in the three southwestern Kansas cities-- it will also make it less risky for developers to build low-to-moderate income rental properties.
Previously, the maximum population of a rural city by federal standards was 20,000 people. According to new standards, cities of up to 50,000 people falling 100 miles outside of a metropolitan area qualify. The new definition adds fewer than 100 communities to the USDA's definition of rural nationally.