In an effort to help first-time home buyers deal with rising real estate costs, the city of Pittsburgh has set aside $15 million in federal bailout aid from the U.S. for grants and mortgages. delayed.
The Urban Redevelopment Authority [URA]the city’s economic development agency, discussed the emerging OwnPGH program on Thursday during its plank meeting as a step towards finalizing the effort. The URA and the City of Pittsburgh Housing Authority [HACP] would run OwnPGH to help first-time home buyers who earn 80% or less of the area’s median income [AMI]. If approved, OwnPGH would provide grants of up to $50,000 and HACP would add an additional $40,000 in deferred mortgages.
“We’re starting that conversation and kicking off the program,” said Derek Kendall-Morris, director of consumer lending at URA. “The overall goal is to increase homeownership across the city for potential buyers at or below 80% AMI.”
The URA can currently only provide deferred funding to people who are buying homes being built or rehabilitated under the agency’s housing development programs, according to the URA Staff Report to the blackboard. If approved, the program would allow the URA to give up to $50,000 to first-time home buyers who earn 80% or less of the AMI. In the Pittsburgh area, 80% of the AMI for a one-person household is $53,100, and for a four-person household it is $75,850.
Under the new scheme, homeowners who buy a home through OwnPGH will be required, for 30 years, to only sell to other buyers who achieve 80% AMI or less.
Additionally, the housing authority’s deferred mortgage of up to $40,000 would require no regular payments and would have a 0% interest rate, according to the URA. If the house is not sold within 10 years, the deferred mortgage will be entirely cancelled.
Kendall-Morris told the URA board that the agency has begun to increase its staff to meet the expected increase in work from the new program.
“We believe we are ready to launch the program,” he said. “We have started recruiting staff for the launch. So we’re pretty much ready to go.
Because funding for the program would come from the US bailout [ARP]it should be in use by 2027.
The URA will accept feedback and continue to finalize the plan, and the board could vote on final approval in October. Subsequently, a financing agreement must be finalized by the city so that the ARP funds are accessible.
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