Switch Realty Blog

Unlock Homeownership: Discover State & Local Home Buyer Assistance Programs 

By: Dustin Hoffman, Realtor, Switch Realty

August 13, 2025

Michigan offers an impressive suite of programs—from statewide deferred loans to local forgivable grants—designed to help prospective buyers bridge the financial gap. As with any program, it is recommended that you consult with a licensed mortgage professional, attorney or other professional resource who can help you understand the nuances of these programs and how they may apply to your specific situation. 

1. MI 10K Down Payment Assistance (MSHDA)
One of Michigan’s most accessible programs, the MI 10K DPA offers up to $10,000 in zero‑interest, deferred loans to cover down payments, closing costs, and prepaid expenses. Buyers repay only when they refinance, sell, or the home is no longer their primary residence. It must be paired with an MSHDA MI Home Loan and requires completion of a HUD‑approved homebuyer education course and a minimum 1% personal contribution. Visit https://www.michigan.gov/mshda/pathway-to-housing to learn more. 

2. First‑Generation Down Payment Assistance (MSHDA, Pilot Program)
Launched in February 2025, this pilot targets first‑generation homebuyers—those whose parents have not owned a home in the past three years, or individuals who aged out of foster care or were emancipated. It provides up to $25,000 in deferred assistance for down payments, closing costs, and prepaid escrows. To be eligible, buyers must combine it with an MI Home Loan, meet credit & income thresholds, complete face‑to‑face homebuyer education, and utilize the home as a primary residence. The program is funded at $8 million and expects to help over 320 families statewide. Visit https://www.michigan.gov/mshda/pathway-to-housing to learn more. 

3. City‑Level & Local Assistance Programs
Michigan cities and counties also offer valuable aid. Please consult the city, county or municipality directly for more information. Program details including qualifications and funding are always subject to change. 

• Detroit Down Payment Assistance Program: Offers up to $25,000 in grants or low-interest loans to buyers within city limits who meet residency and income criteria—many loans can be forgivable if owner‑occupancy requirements are met.
  
  

• Grand Rapids Homebuyer Assistance Fund: Zero‑interest loans up to $7,500, often forgivable if the buyer remains in the home for a set period.
  
  

• Additional programs in Lansing (up to $14,999) and East Lansing (up to $30,000) also aid eligible first‑time buyers.
  
  

• Other city and county programs—for example in Kalamazoo, Washtenaw County, and Genesee County—offer grants or loan‑based support and often include homebuyer education and local assistance.

4. National & Nonprofit Programs Available in Michigan
Michigan buyers may also qualify for programs like:

• National Faith Down Payment Assistance (Wayne County): Provides approximately $13,999 in zero‑interest, forgivable loans after 5 years.
  
  

• NACA (Detroit Neighborhood Initiative): Offers assistance with no down payment, no closing costs, and no mortgage insurance.

Always consult the organization directly to learn more about qualifications and funding. These are always subject to change.

Why It Matters for Buyers—and for You

• Lower upfront costs make homeownership accessible, especially for those with savings constraints.
  
  

• Deferred or forgivable loans reduce long‑term financial burden.
  
  

• Education requirements ensure more sustainable homeownership and financial empowerment.
  
  

• Stackable funding—clients may combine multiple programs (e.g., MI 10K + local grants + tax credits) to maximize benefits.
  
  

Switch Realty can Help!

At Switch Realty we’ve helped clients who are using one of several of these programs find homes that fit their needs. We take the time to listen, partner with you and your mortgage professional and ensure that you are getting the best negotiated price and terms for your home purchase. Give us a call today and experience the Switch Realty difference. 

1031 Exchanges - Considerations for Property Investors 

By: Dustin Hoffman, Realtor, Switch Realty

June 20, 2025

In this month’s blog post, we talk about 1031 exchanges and how they can be used to help customers defer capital gains taxes when they sell investment properties. It’s important to note that the content herein represents my opinion only and is not meant to recommend, outline or otherwise detail all of the steps, rules and applications of 1031 exchanges. You should always consult with an attorney and a tax professional before moving forward with a 1031 exchange. Hopefully, this blog post will give you some ideas and thoughts about how a 1031 exchange could benefit you.  

What Is a 1031 Exchange and Why Michigan Real Estate Investors Should Consider It

If you're a real estate investor in Michigan, you've probably heard of a 1031 exchange—but do you know how powerful it can be for growing your portfolio? A 1031 exchange, named after Section 1031 of the Internal Revenue Code, allows investors to defer paying capital gains taxes when they sell one investment property and reinvest the proceeds into another "like-kind" property. Used correctly, it can be a game-changer for long-term wealth building.

What Exactly Is a 1031 Exchange?

A 1031 exchange allows you to sell an investment property and reinvest the proceeds into another qualifying property without immediately paying capital gains tax. Instead of recognizing the gain as taxable income, the IRS allows you to "exchange" the property, rolling the gain into the new investment.

The term “like-kind” can be misleading—it doesn’t mean you have to exchange an apartment building for another apartment building. In fact, most real estate is considered like-kind with other real estate, as long as it's held for investment or business purposes. So, you can exchange vacant land for a rental home, or a commercial office in Southfield for a duplex in Port Huron.

Key Rules to Know

To qualify for a 1031 exchange, you must:

1. Use a Qualified Intermediary (QI): You can’t take possession of the sale proceeds; a QI must hold them until the next property is purchased.
   
   

2. Identify the Replacement Property Within 45 Days: You must formally identify the new property (or properties) within 45 days of selling the original.
   
   

3. Close Within 180 Days: You must close on the replacement property within 180 days of selling the original one.

Benefits of a 1031 Exchange

1. Tax Deferral:
This is the most obvious advantage. Capital gains taxes can eat into your profits—sometimes as much as 20% or more when including federal, state, and Net Investment Income Tax. A 1031 exchange allows you to reinvest your proceeds into new properties, compounding your investment power.

2. Portfolio Growth:
By deferring taxes, you can move into more valuable properties, diversify into different markets, or shift from high-maintenance assets to passive ones. This can be particularly helpful in Michigan, where the real estate market varies greatly between cities like Detroit, Royal Oak, and Traverse City.

3. Estate Planning Advantages:
If you continue to exchange properties throughout your life, your heirs may inherit the real estate at a “stepped-up” basis—essentially erasing the deferred capital gains tax liability.

4. Flexibility in Investment Strategy:
Whether you’re consolidating multiple properties into one or breaking up a single asset into several smaller ones, 1031 exchanges can support your evolving investment strategy.

Final Thoughts

1031 exchanges are a powerful tool for Michigan investors looking to build long-term wealth and minimize taxes. However, they’re not DIY projects—planning and professional guidance are essential. Always consult with a qualified intermediary, attorney, tax advisor, and real estate professional (like me!) to ensure your exchange goes smoothly and meets IRS guidelines.

If you're thinking about selling an investment property and want to explore your options, I’d be happy to help you navigate the 1031 exchange process here in Michigan.

The Pop Up Tax: Tips for Challenging Your Home’s Taxable Value

By: Dustin Hoffman, Realtor, Switch Realty

May 31, 2025

I recently helped a client appeal their property’s taxable value this year to the local municipality, and I’m happy to report that we were able to reduce the property tax annual payment by almost $3,500 (or roughly $290/month). How did we do this? Can you also save money on your property taxes? Let’s find out….

Property Taxes - A Brief Background:

In Michigan, when you buy a property from a seller the Assessed Value of that property becomes “uncaped” or “reset” to align with the Market Value of similar properties in the area (and, using the property’s purchase price as a benchmark). Your city, township or municipality then uses the new Assessed Value to determine your property’s Taxable Value, which is then used to calculate how much you owe annually for property taxes. For new homeowners, sometimes receiving that first property tax bill can be a real shock. Many times property websites like Zillow or others don’t show potential buyers the “uncapped” estimated property tax payment. Rather, they base the property tax payment on the home’s current Taxable Value (which we know will be much lower). 

There are two primary reasons that may motivate you to appeal your property’s Taxable Value, in an effort to reduce how much you will owe. First, if you are the new owner of the property and you believe the new Assessed Value is higher than what you paid and/or what you believe the property is worth. Second, if you are the current owner, however, you believe that the Taxable Value is now higher than the Assessed Value of the property. 

Should You Appeal Your Property’s Assessed Value?

Before you make a decision to appeal, you’ll receive a notification in the mail from the Michigan Department of the Treasury that will contain your property’s “Notice of Assessment, Taxable Valuation and Property Classification.” This notice will detail the Assessed Value and State Equalized Value (approx. 50% of your home’s fair market value) and the Taxable Value (which will equal the Assessed Value if you are the new owner of the home). If you believe that the Assessed Value is too high (remember, take the Assessed value and multiply it by 2 - this will give you what the Assessor believes your home is worth) you may want to make an appeal to your local tax board (remember, not all appeals are successful). 

How Do You Make An Appeal?

Sometimes, the Notice of Assessment will have instructions on the bottom for when/how to appeal your property’s Taxable Value. Other times, you’ll need to check with your local city, township or municipality. Once you make the appointment for the appeal hearing (or, prepare a report to submit), you’ll need to prepare your evidence and presentation. Essentially, you’re working to prove that based on current property values and historical taxation rates, your property is being overvalued by the Assessor. How? Here are some things to include in your presentation (and some things to avoid): 

• Determine where your property is, in relation to the “assessment zones” that each city, township and municipality use to determine property value. 

• Based on your property’s location, try to find as many comparable homes as possible that have sold within the last year (you can go to 2 years, however, more weight is given to homes sold in the past year). In this comparable home set look for what the property sold for, the Assessed Value as of today (this is all public information that can be obtained through your municipality’s website or offices) and how this compares to your home (what you paid, your home’s relative condition and other factors). If there is a difference here, this may strengthen your argument that your home is being over valued.

• For the comparable home set, calculate the ratio of Taxable Value to the Sales Price. For example, if a home was purchased for $200,000 and the Taxable Value is $100,000; the ratio is 0.50 or 50%. If your home’s ratio is above the average ratio for the comparable home set (or even above a few of the homes), this may further strengthen your argument that your home is being over valued.

• Finally, take a look at properties currently being listed for sale in your area. How does your home compare? If you had to set a listing price for your home based on the Assessed Value would your home be competitive (e.g. is your home updated vs other home’s currently listed?)? If your home wouldn’t be competitive, this could be another point to consider that may support your conclusion that your home is being overvalued. 

When you meet with your tax board it’s also important to stick to the facts and numbers about your property. Although it may be tempting to ask or discuss “how” your taxes are being spent, this is a topic that is outside of the purview of the tax board and will only distract from your presentation (and, take away from your allotted time - some tax board appointments are only 15 minutes long!). 

Involve a Real Estate Professional and/or Attorney:

There’s a lot to research and consider when appealing your home’s Assessed Value. I always tell clients that they may want to consult with a real estate attorney and/or a licensed real estate professional as a first step before beginning the appeal process. Remember, the recommendations I offer here are just that - recommendations. Everyone’s situation is different and I can’t stress enough how important it is to involve a licensed professional (attorney and/or real estate agent) in your appeal process. And, a good Relator will continue to provide you with guidance and support after the home sale, in order to help advise you on issues just like this. 

The Switch Realty Difference:

At Switch Realty, our real estate agents and attorneys have experience in working with tax boards and advising our customers on the best course of action. We firmly believe that our job doesn’t stop when the closing ends. Looking to buy or sell a home? Have questions about your property taxes? Give us a call and experience the Switch Realty difference. Lower fees, more value for our customers and more personal attention. 

*Note: the content presented in this email is directional only. Consult a real estate professional and/or attorney about your specific situation before proceeding with any tax board appeal.

The Benefits of Buying a Home, Compared to Renting

By: Dustin Hoffman, Realtor, Switch Realty 

April, 2025

Why Buying a Home Beats Renting: 6 Key Benefits Every Buyer Should Know

If you’ve been renting and wondering whether it’s time to buy a home, you're not alone. With rising rents and more people looking for long-term stability, the debate between renting vs. buying has never been more relevant. While both have their place depending on your lifestyle and financial situation, buying a home offers distinct long-term advantages. Here’s why purchasing a home is a smart move for many.

1. Build Equity, Not a Landlord’s Wealth

When you rent, your monthly payments go toward your landlord’s mortgage—or their pocket. When you buy, those payments help you build equity in your own property. Over time, this equity becomes a valuable asset that can be used for future goals like home renovations, investing, or retirement.

2. Stable Monthly Payments

Rent can increase every year—sometimes substantially—depending on your lease terms and the local market. When you own a home with a fixed-rate mortgage, your principal and interest payments stay the same for the life of the loan. That stability helps with budgeting and long-term planning.

3. Tax Advantages

Homeownership can come with significant tax benefits. You may be able to deduct mortgage interest and property taxes, which can reduce your overall tax burden. Be sure to consult a tax professional to understand how these benefits apply to your specific situation.

4. Long-Term Financial Gain

Historically, real estate tends to appreciate over time. That means the home you buy today could be worth significantly more in 10, 15, or 20 years. It’s not just a place to live—it’s a long-term investment that often outpaces inflation and builds generational wealth.

5. Predictable Housing Future

When you own your home, you’re in control. There’s no risk of being asked to move out at the end of your lease or facing rent hikes each year. That kind of predictability provides peace of mind and the ability to plan for the future without uncertainty.

Final Thoughts

While renting may offer flexibility in the short term, buying a home provides unmatched benefits when it comes to building wealth, stability, and freedom. If you're ready to take the next step toward homeownership, now could be a great time to explore your options.

As a local realtor, I’m here to help you navigate every step of the process—from understanding your financing options to finding a home that fits your lifestyle and budget. Let’s connect and turn your homeownership dream into a reality.