Down Payment Assistance for New Construction in Southern Oregon: A 2026 Guide

One of the most common questions I hear from buyers exploring new construction in Southern Oregon is whether down payment assistance programs can be used on a brand new home. The short answer is yes. And the longer answer is that there are some excellent options available right now for buyers in Jackson County and across the state.

I have walked many first-time buyers through the process of combining down payment assistance with a new construction purchase, and it opens doors that a lot of people do not realize are available to them. In this guide, I will cover the key programs that can help you buy a new construction home in the Rogue Valley with less money upfront, what the eligibility requirements look like, and how to make sure you are positioned to take advantage of them.

Oregon Housing and Community Services (OHCS) runs the state's flagship down payment assistance program, and it is one of the most generous programs I have seen. Qualified first-time and first-generation homebuyers can receive up to $60,000, or 20 percent of the purchase price, whichever is less. That is a significant amount of help, especially when you consider that it can be applied to a newly built home in one of Southern Oregon's growing communities.

To qualify, your household income must be at or below 100 percent of the area median income for Jackson County. Funds are awarded on a competitive basis through approved organizations throughout the state, so working with a lender who is familiar with OHCS programs is important. The program also requires completing homebuyer education and housing counseling, which is a great way to make sure you feel confident about the entire buying process. And importantly, 25 percent of program funds are reserved for Oregon veterans.

New construction single-family homes are eligible under this program. That means if you are looking at communities like Addysen Park in Medford, Ponderosa Place by Hayden Homes, or even the new Holt Homes communities in Eagle Point, this assistance can apply to your purchase.

The OHCS Flex Lending Program offers another route for buyers. It provides down payment assistance equal to 4 or 5 percent of the first mortgage loan amount for low-to-moderate income borrowers. Depending on how you structure it, this can be set up as a silent forgivable second lien, meaning you do not have to make payments on it, or as an amortizing repayable second lien.

For a new construction home priced in the $380,000 range, which is where some of Medford's entry-level new homes start, 4 percent of the loan amount works out to about $15,000 in assistance. That covers a meaningful portion of a typical down payment and can make the difference between waiting another year to save and buying now.

While this program does not provide direct down payment assistance, it is worth mentioning because it offers below-market interest rates through approved lenders across the state. A lower rate means a lower monthly payment, which can free up cash or make a new construction home more affordable over the life of the loan. It is also compatible with other assistance programs in many cases, so you may be able to pair it with OHCS down payment assistance for an even better overall package.

Beyond the state-level programs, there are local resources available specifically for buyers in Jackson and Josephine Counties that can make a real difference.

The RVAR/OAR HOME Foundation Buyers Assistance Grant provides non-repayable grants of $1,000 to $2,500 for first-time homebuyers in our area. This grant is administered through ACCESS, a community action agency that serves Jackson County. To qualify, you need to contribute at least $500 of your own funds, complete homebuyer education, and meet with a Certified Homeownership Counselor. It is not a huge amount, but paired with other assistance programs, every dollar counts when you are pulling together a down payment and closing costs.

ACCESS also administers OHCS down payment assistance grants locally, so they are a great first phone call for anyone in Jackson County who wants to understand what is available. Their Homeownership Center can walk you through income limits, purchase price limits, and the application process for multiple programs in one conversation.

Not every lender knows how to pair down payment assistance with a new construction purchase. The process is a little different from a standard resale transaction because new construction timelines are longer, builder contracts have their own language, and the assistance funds need to be coordinated with the builder's preferred lender or an approved outside lender. Here are a few things I have learned helping buyers navigate this process.

• Start with a lender who knows DPA programs. Not all lenders are equally familiar with OHCS and local programs. Ask upfront whether they have experience closing loans with down payment assistance on new construction homes. If they hesitate, it is worth finding a lender who does this regularly.
• Understand builder lender requirements. Some builders have relationships with specific lenders and may offer incentives for using their in-house financing. Those incentives can sometimes be as attractive as finding your own lender, but you need to compare the total cost, including how the down payment assistance integrates.
• Watch the timelines. New construction homes take months to build, and down payment assistance funds sometimes have expiration dates or specific timing requirements. You need to make sure the assistance approval stays valid through the expected completion date of your home.
• Factor in the price limits. Down payment assistance programs have maximum purchase prices. For a new construction home, make sure the home you are choosing stays within those limits. Some of Medford's larger floor plans or homes with premium lots may push past the cap.
• Complete homebuyer education early. Most of these programs require a homebuyer education course. Getting that done before you start seriously touring homes means one less thing to coordinate later, and the courses are genuinely useful for understanding the full picture of homeownership costs.

Let me give you a practical example. Say you are looking at a new construction home in Ponderosa Place by Hayden Homes in East Medford, where homes start from around $349,990. With the OHCS Down Payment Assistance Program, you could qualify for up to $60,000 in assistance, though the actual amount depends on your income and the program's funding at the time of your application. With a 5 percent conventional down payment on a $350,000 home, your down payment would be $17,500. Down payment assistance could cover most or all of that, leaving you to focus on closing costs and any builder-required deposits.

Or say you are looking at a home in the mid-$400,000s at Addysen Park. The OHCS Flex Lending program at 4 percent would give you around $17,000 to $18,000 in assistance. Depending on your loan type and the specific program structure, that could cover your entire down payment.

Every buyer's situation is different, of course. Income limits, purchase price caps, and available funding all change over time. But the key takeaway is this: there is real, substantial help available for buyers who want to purchase new construction in Southern Oregon, and it is worth exploring early in your home search.

If you are reading this and thinking the programs sound like they could help, here is how to get moving. First, reach out to ACCESS Homeownership Center or speak with a lender who is familiar with OHCS programs. They can tell you what programs you qualify for based on your income and the price range you are targeting.

Second, complete your homebuyer education early. This is a requirement for most assistance programs anyway, and it will give you a solid foundation for the whole process. The course covers budgeting, credit, the mortgage process, and what to expect at closing. It is time well spent.

Third, get connected with a buyer's agent who understands both new construction and down payment assistance. I have helped several buyers navigate exactly this combination, and having someone who knows both worlds makes the process smoother and less stressful. We can identify communities that fit within program price limits, coordinate with lenders, and make sure the assistance is properly applied at closing.

Lisa Sears, REALTOR®, eXp Luxury

Serving Southern Oregon