The City of Houston’s Affordable Housing Drive was held on March 25th on the grounds of city hall. Its goal was to connect potential home buyers with organizations and builders involved in affordable housing programs. Participating were a broad range of government and non-profit agencies focused on assisting low- and middle-income residents in finding low cost homes. They included HUD representatives, City, County and State agencies, as well as Habitat For Humanity, the NID Housing Counseling Agency and others.

The federal government’s response has been to modify home owners’ existing loans and assist borrowers in getting cheaper credit. But this has not solved the long term problem of increasing the availability of affordable housing. So state and local agencies have initiated assistance programs for down payments and closing costs to encourage more low cost home ownership. Many of these programs receive grants from HUD.

The City offers three down payment assistance programs through its Housing and Community Development Department. Houston Hope Homes was initiated to revitalize some of Houston’s historic neighborhoods by offering affordable homes to current residents, and to attract new residents to the areas. Down payment assistance of up to $37,000 is available to qualified buyers. The home must be located in a Houston Hope designated area and the combined family income must be at or below 80% of the area medium income. The maximum sales price is $200,160 and the buyer must agree to live in the home for 10 years. Houston Hope houses are built by local builders who contract with the City to provide energy efficient homes with cost-effective materials and floor plans.

The Home Buyer Assistance Program provides direct financial assistance to offset portions of the down payment, closing costs, prepaid items and principle required for a home purchase. The funding is through HUD, block grants, the American Dream Down Payment Initiative and Tax Increment Reinvestment Zones. A qualified buyer can receive up to $19,500 in down payment assistance. The program has the same eligibility requirements as the Houston Hope program. The buyer must demonstrate the ability to obtain a mortgage loan.

The third program is called the Workforce Housing Down Payment Assistance Program. It was created to provide residents an opportunity to purchase a new home in areas designated by the mayor for revitalization. One difference from the other two programs is that the combined family income must be at or below 80% to 120% of the area medium income. The maximum price of the home cannot exceed $150,000. The assistance provided to each approved buyer is $30,000.

Currently, the City has temporarily suspended taking applications for the down payment assistance programs due to the high volume of applications it has received. The processing time was extended to 6 to 8 weeks. The City says it needs time to eliminate the backlog of applications. It will resume accepting applications after May 17.

Mayor Parker recently appointed James Noteware as the new director of the City of Houston’s Housing and Community Development Department. The HCDD manages and administers the funding for five housing related programs. In addition to down payment assistance, it manages single family home repair assistance, and commercial multi- and single-family housing development.

The Mayor has said she wants to have more community development of affordable homes. She told the Urban Land Institute in March that she would like to see the emphasis on housing shift to upgrading and repairing what is already built. She said that it may be best to tear down some of the worst housing units. She wants to include more middle-income and mixed-income affordable housing in future developments.

The City is joined by the County and other organizations in home buyer assistance programs. Harris County has created the H.O.M.E. Program to fund projects that create home ownership opportunities through acquisition of foreclosed and vacant homes. The County sells these to qualified buyers at 20% below purchase price. The buyer may also be eligible for assistance with down payment and closing costs.