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We'll be buying our first house in the next couple months and I had a couple questions. First some background though. We'll be using the Section 8 Homeownership program, and the voucher we qualify for allows a mortgage payment(including taxes, PMI) of $1,800 monthly. We'll also be applying for the DCCA and MCC programs under HUD. The DCCA gives us a loan up to 1/3 the property value or $35K (http://www.co.san-diego.ca.us/sdhcd/docs/dcca_program_overview.pdf). The MCC gives us up to 20% of our mortgage interest paid for the year back as a federal tax deduction (http://www.co.san-diego.ca.us/sdhcd/homeowners/mcc.html). So we'll be making a downpayment of most likely $40K, and monthly payments of $1,800. I figured under current rates for a 30 year fixed, that qualifies us for a loan of up to $350K. Does this sound right? For that amount we're hoping to find a 3bdrm/2bth with a large yard, and sq.ft. for the house around 1,200. The area we'd prefer to buy in is Bonita, but we'd also consider Imperial Beach, both cities in San Diego county. Does this sound like a realistic scenario in this market for those areas of San Diego? Appreciate any input.

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