A run on D.C.’s flagship program for first-time home buyers that set off after the city boosted its maximum benefits to blunt the pain of rising interest rates, housing costs and inflation has maxed out the fund’s capacity, applicants learned this week.
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The program’s remaining dollars are spoken for through the end of the budget year — limiting the reach of an initiative that is key to the efforts of Mayor Muriel E. Bowser (D) to lift low- to moderate-income residents into homeownership. While it is not uncommon for the funds to dwindle toward the end of the cycle, officials with the city’s Department of Housing and Community Development said that challenge typically crops up much later in the year.
“The demand was so much greater this year with the change,” DHCD Director Colleen Green said. “Given the economy, given the [budget] pinch, given the increase, it’s just a perfect storm, so we had to pause it. We did everything we could.”
Interest ticked up in the Home Purchase Assistance Program, which offers a low-interest loan to qualified home buyers and allows them to defer repayment for up to five years, when Bowser in August announced enhanced benefits to counter a challenging real estate market. First-time home buyers could qualify for up to $202,000 in gap financing and down payment assistance, up from $80,000 in prior years, and up to $4,000 in closing cost subsidies under the revamp, she said.
