Buying a historic home in the U.S. can be a rewarding adventure—bringing charm, rich stories, and character into your daily life. But older homes often need more work, and that’s where historic home grants US and preservation tax credits come in handy. This guide explores how to identify historic homes, what financial help you can tap into, and how to renovate smartly—all in straightforward, human-friendly language.
Why Historic Homes Are Special (and Challenging)
Historic homes often boast details like original moldings, vintage fireplaces, or stained-glass windows—features you won’t find in new builds. They anchor neighborhoods, tell local stories, and can increase in value over time.
But they also come with responsibilities:
- Deferred maintenance—old systems, materials, and structures often need updates.
- Renovation standards—many homeowners must follow specific preservation rules.
Thankfully, financial incentives from the federal government, states, and nonprofits help ease the burden.
Finding the Right Historic Home
- Historic Districts & Registers
- Look for homes listed in the National Register of Historic Places or local landmarks registers. Eligibility is often required for grants and tax credits.
- For example, homes in California’s Mill Act program or Chicago’s landmark districts often qualify.
- Look for homes listed in the National Register of Historic Places or local landmarks registers. Eligibility is often required for grants and tax credits.
- Understand the Rules
- Some designations don’t restrict cosmetic changes but require review for structural alterations or demolitions.
- In other areas, board approvals or architectural guidelines may apply.
- Some designations don’t restrict cosmetic changes but require review for structural alterations or demolitions.
- Choose Your Fixer-Up Level
- A mild fixer: just need kitchen updates, insulation, or plumbing work.
- Full renovation: might include structure, electrical system, or historical restoration.
- A mild fixer: just need kitchen updates, insulation, or plumbing work.
Historic Home Grants in the US
Federal Grants
- Historic Preservation Fund (HPF)
- Runs formula and competitive grants for nonprofits, communities, and governments.
- Example: Rural Revitalization Grants help restore historic homes in smaller towns.
- Runs formula and competitive grants for nonprofits, communities, and governments.
Nonprofit & Local Grants
- National Trust Preservation Funds
- Offers planning and “bricks & mortar” grants from $2,500–$10,000.
- Includes specialized grants like African American Heritage Action Fund—over $150M awarded since 2017.
- Offers planning and “bricks & mortar” grants from $2,500–$10,000.
- State & City Programs
- Many states (e.g., Tennessee) offer 50/50 matching on preservation costs.
- California’s Mills Act provides steep property tax breaks for restoration.
- Many states (e.g., Tennessee) offer 50/50 matching on preservation costs.
- Local Trusts
- Groups like the New York Landmarks Conservancy provide grants/loans ($35K–$300K) for façade and structural work.
- Regional trusts like Georgia Trust use revolving funds to preserve at-risk homes.
- Groups like the New York Landmarks Conservancy provide grants/loans ($35K–$300K) for façade and structural work.
Preservation Tax Credits: Save as You Spend
Federal Historic Rehabilitation Tax Credit (HTC)
- Offers 20% credit of eligible rehab expenses for income-producing historic properties.
- Eligible costs: structural components, walls, floors; excludes things like cabinets or landscaping.
- A powerful tool: about $127B in private investment has flowed into historic rehab since 1976.
State-Level Credits
- Many states, including Illinois and California, offer their own credits (often 10–25%).
- They stack with the federal credit to reduce tax burden—all while preserving character.
Meeting the Standards
To qualify, work must follow the Secretary of the Interior’s Standards, ensuring preservation rather than replacement.
Step-by-Step Guide to Funding Your Renovation
- Identify an Eligible Property
- Check register status and local certifications.
- Check register status and local certifications.
- Estimate Rehab Costs
- Review which expenses qualify for federal/state tax credits and which might be covered by grants.
- Review which expenses qualify for federal/state tax credits and which might be covered by grants.
- Apply for Grants Early
- For example, HPF formula grants open yearly; NTHP cycles quarterly.
- For example, HPF formula grants open yearly; NTHP cycles quarterly.
- Plan Work to Align with Standards
- Use preservation-friendly contractors familiar with historic materials and tax rules.
- Use preservation-friendly contractors familiar with historic materials and tax rules.
- Claim Tax Credits
- Coordinate with your State Historic Preservation Office and IRS using Form 3468.
- Coordinate with your State Historic Preservation Office and IRS using Form 3468.
- Use Local Support
- Check your city’s preservation commission, local trusts, and nonprofit partners for low-interest loans or matched grants.
- Check your city’s preservation commission, local trusts, and nonprofit partners for low-interest loans or matched grants.
🧾 Real-Life Example: Mills-Act Home in Pasadena, CA
Susan and Miguel found a 1920s Craftsman bungalow in Pasadena:
- Price: $800K
- Rehab cost: $200K (restored porch, rewired, added HVAC)
- Mills Act cut their property tax by ~50%—saving $8,000/year.
- They claimed $40K in state tax credits (20%) and $120K federal credit, boosting their rehab budget by $160K.
Result: a beautifully restored home, lower taxes, and powerful investment.
Common Pitfalls to Avoid
- Skipping preservation consultations—may miss eligible tax credits.
- Random contractor choices—non-certified work can invalidate credits.
- Applying too late—grants often require pre-approval.
- Ignoring matching grant clauses—many expect you to cover half the cost.
Final Takeaways
- historic home grants US and preservation tax credits significantly reduce renovation costs.
- Start early: identify grants, tax credits, and professional support.
- Follow standards: maintain historical integrity to qualify.
- Use a combined strategy: mix federal, state, local, and nonprofit funding.
With proper planning, buying and restoring a historic home can be both affordable and deeply rewarding—helping you preserve history while building a beautiful future.
