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May 09, 2019

Philly First Home program will provide $3 million in assistance to new homebuyers in 2019

Real Estate Homeowners
01292019_Stock_Rowhomes_TC Thom Carroll, File/PhillyVoice

Pennsylvania law requires taxation to be uniform so all property that is not expressly exempt from taxation, must be taxed at the same rate. Thus, commercial properties cannot be taxed at a higher rate than residential properties and higher taxes cannot be imposed on more-valuable properties.

A new program to help Philadelphia residents become first-time homeowners will distribute up to $3 million in financial assistance during the second half of 2019, city officials announced on Thursday.

The Philly First Home program is an expansion of the city's previous down payment assistance programs, which offered between $500 and $1,500 to help new homebuyers achieve their goals.


EARLIER: Philly to announce $10,000 assistance program for first-time homebuyers


With new funding from the Philadelphia Housing Trust Fund, the city will now provide up to $10,000 to eligible first-time homebuyers who work with counselors from the Division of Housing & Community Development (DHCD). The program is expected to help 300 families or individuals purchase homes in its first year.

“Homeownership is often the most significant investment an individual or family will ever make, and we need to make sure everyone has equal access to the long-term financial stability homeownership can provide,” Council President Darrell L. Clarke said at a press conference Thursday afternoon.

Clarke said many families in Philadelphia have the ability to pay a mortgage but cannot afford to save up for a down payment. Factors such as student debt, child care and auto loan payments often prevent residents from setting aside the cash needed to make a down payment.

Eligibility for the program depends on homebuyers meeting the following requirements:

Be a first-time homebuyer or a buyer who has not owned a home for at least three years
Be a resident of the City of Philadelphia for three years and must purchase a home in Philadelphia
Have a household income at or below 120% Area Median Income (AMI)
Complete housing counseling at a DHCD funded housing counseling agency

Area median income guidelines are determined by the U.S. Department of Housing & Urban Development. Those figures reflect the nine-county Philadelphia metropolitan area. The table below shows the maximum income level (120% of AMI) to qualify for the program based on the number of people in a household.

Family Size Maximum Income (120% of AMI)
 1$75,720
 2 $86,520
 3 $97,320
 4 $108,120
5 $116,880
 6 $125,520
 7 $134,160
 8 $142,800


The money Philly First Home provides become a lien on the property's first mortgage. The lien will be forgiven after the homeowner owns the property for 15 years. Prior to that, the sum will be due upon the property's sale or refinancing.

Officials said the goal of the program is to build sustainable homeownership in Philadelphia neighborhoods and counteract a dramatic shift toward renters since the turn of the century. The city's renter population now accounts for roughly half of the housing market.

The program has already been allocated another $2.5 million for 2020, with funding in subsequent years still to be determined.

Philadelphia's director of Planning & Development, Anne Fadullon, said the private market is a critical part of the Philly First Home program, which will become a vital resource for realtors working with clients. 

"Settlement assistance allows the government to ignite the market and then get out of the way," Fadullon said.

The program will operate on a "first come, first qualified" basis, officials said, and will be open to all those who meet the eligibility requirements.

Those who are interested in receiving down payment assistance must visit with a DHCD-funded counselor at one of 28 locations throughout Philadelphia.

The program will officially launch June 10.

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