Individuals and businesses involved in real estate development activities may be interested in real estate grants. Grants may be used to purchased property; however, the majority of real estate grants are for development activities. The majority of these grants are available through the U.S. Department of Housing and Urban Development (HUD) and foundations that focus on housing issues.
Low-income individuals may be eligible for real estate grants that target new homeowners. HUD sponsors programs throughout the country that provide down payment assistance to help individuals become first-time homeowners. These programs primarily target low-income working individuals although some may assist a small percentage of middle-income individuals.
Nonprofit organizations and businesses can receive real estate grants from state and local governments. These grants cover the costs associated with purchasing property. A condition of the grant is property use. Governments will require final approval of the purpose of the property which should generally be for public use. Real estate grants cannot be used for private properties.
Businesses may have a further requirement that the purchase of the property include creation of jobs. If the business wants the real estate grant for expansion purposes, it should be fairly straight forward to add jobs to the local economy. To do more, you likely need more employees.
HUD administers several programs that award real estate grants. Local Community Development Block Grant (CDBG) programs may allow grant funds to be used to purchase property. The property must be used to address a specific community issue. An example is a community center or even a business incubator for economic development activities.
Other HUD real estate grants focus on redeveloping brownfields or establishing housing for specific populations such as senior citizens or veterans. Grants that deal with land require extensive environmental testing to identify toxins and other contaminants. This is particularly important when a building currently exists or previously stood on the property. When buildings change use, laws that govern that use must be followed to prevent release of or exposure to harmful poisons. Urban areas in particular face these issues because buildings are old and are not always up to code.
Foundations are another potential resource for real estate grants. These grants are for nonprofit organizations with missions that include the need for property or buildings. Nonprofit housing organizations are an example as are nonprofit nursing care facilities. Established nonprofits that need to move or expand may be able to get capital or real estate grants from local foundations that support the same communities served by the nonprofit.