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Expand home loans to help buyers, county

Pasco County and the state of Florida want to turn renters into homeowners.

It's not a new plan, but to entice greater participation in a state-funded program, Pasco County is considering nearly doubling the amount of money a potential home buyer can borrow. That is an affordable luxury when there is $3.5-million available for lending.

It also is an unfortunate byproduct of Pasco's booming housing market. The county suspects program involvement is lagging because home prices are escalating faster than wages.

The home buyer assistance program loans low- and moderate-income families money for down payments, closing costs or fees tied to acquiring a house. It's a loan, not a grant, and must be repaid at zero percent interest. Still, it's a great deal. You don't have to be a first-time buyer or even a current county resident and the money can be used for a newly constructed home.

For now, the maximum loan is $23,500 for a family of four. Additional dollars are available to cover government impact fees. To qualify, a family must earn less than 120 percent of the median income in the Tampa Bay area, or a maximum of $61,440 for a family of four. The program applies to single-family homes, condominiums and townhomes. Mobile homes do not qualify. Top purchase price is $135,000 for an existing house and $150,000 for a new home.

The proposed changes will increase the loan amounts up to $40,000 depending on income and whether the house is new or existing.

There are public safeguards as well. The loan begins accumulating interest if the home is rented out later.

A year ago, 250 families applied. Community Development manager George Romagnoli told Times staff writer Bridget Hall Grumet he thinks some families are hesitant to apply because of escalating housing prices. As Romagnoli indicated, Pasco families receiving the state housing dollars paid an average of $49,183 for a house 10 years ago. By 2004, the average home price for those families was $88,189, an 80 percent increase. Pasco's salary scales have not grown at the same rate.

Boosting the amount available for down payments should help move more families into their own homes. It is a sound idea. Home ownership is one of the most logical ways to enhance neighborhoods, maintain a property tax base and ensure older areas don't decay into vacant property that can become targets for criminal activity or public health concerns.

There is plenty of property available, particularly in urbanized west Pasco, even though countywide nearly four of every five homes are owner occupied.

According to the 2000 census, rental properties in Hudson, Holiday and Jasmine Estates totaled nearly 5,000, a 30 percent increase over the previous 10 years. It is a well-documented phenomenon. Northern retirees, lured by modest prices in west Pasco, dominated the demographics in the 1970s and '80s. As original buyers moved or died, the homes frequently became rental properties for younger tenants.

County commissioners would be wise to authorize the loan program's expansion. Monthly mortgage obligations are preferable to rent payments when it comes to investing in neighborhoods.