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Affordable Home Program Launched in Philadelphia

PHILADELPHIA — City Council President Darrell L. Clarke (5th District) joined by Councilmembers, housing officials, and advocates, today announced the single largest developers of affordable housing in Philadelphia history – 1,000 affordable homes to be built across the city.

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“Turn The Key”, the Philadelphia Affordable Homeownership Program, is being funded through the $400 million Neighborhood Preservation Initiative (NPI) program created by City Council in 2020.

“Turn The Key” and NPI will provide funding to build more than 1,000 new, energy-efficient, 3 bedrooms, 1 ½ bath homes on publicly-owned city land. Several Requests For Proposals have already been issued to develop homes, and RFPs will continue to be issued on a rolling basis until 1,000 homes are built and sold to qualifying home-buyers.

Using publicly-owned land reduces development costs and increases the affordability of the new homes. The mortgage for these 3-bedroom homes will be about $1,200 per month — considerably less than the median monthly rent of about $1,700 for a 2-bedroom apartment in Philadelphia.

“Today is the beginning of a new era in affordable homeownership in Philadelphia,” said Council President Clarke, at a news conference announcing the Turn the Key program at 55th and Poplar Streets in West Philadelphia. “With funds from the Neighborhood Preservation Initiative and publicly-owned city land, we’re launching the largest development of affordable housing in city history. We’ve selected and will continue selecting developers to build at least 1,000 affordable new homes for ownership. Philadelphians who buy these 3-bedroom homes will have mortgage payments that are less than the current average rent for a 2-bedroom apartment.”

Clarke was joined at the news conference by an array of public officials and advocates, including multiple members of the City Council, the city’s top housing official, a municipal employees’ union leader, and several longtime advocates for affordable housing.

“The City’s Department of Planning and Development and PHDC is proud to partner with Council President Clarke to build these homes,” said Anne Fadullon, the Kenney administration’s Director of Department of Planning and Development. “We are looking forward to working together to create these pathways for families to build generational wealth and receive other benefits that come from homeownership. This is an exciting project that will have a great impact on our city.”

Thursday’s press conference took place at two city-owned lots at 55th & Poplar Streets in West Philadelphia, in the Fourth Council District. Councilmember Curtis Jones, Jr., who represents the district, was on hand. “The biggest investment most people make in one’s lifetime is in their home,” Jones said. “It’s an asset that should always appreciate but in its initial phases, be affordable as well.”

Clarke and Jones were joined by Councilmembers Cherelle ParkerMark Squilla,  Maria Quiñones SánchezKatherine Gilmore RichardsonDerek GreenHelen Gym, and Jamie Gauthier.

The Mortgage Affordability Aspect of Turn The Key Program

To make these homes affordable to households that are at or below 80% of the Area Median Income, NPI funds will be used to provide first-time homebuyers with a soft loan. Under the NPI Mortgage Affordability Program, soft loans of up to $75,000 (subject to the buyer’s household income) will be made available to buy down the cost of the new homes. These loans will be secured through a second mortgage placed on the property.

The term of the loan will be for up to 30 years, with a portion of the loan forgiven over time, such that by year 30, the loan will be completely forgiven.

To be eligible, first-time homebuyers must have not previously owned a home or owned a home in the last three years, be income-certified, and complete a free, city-funded homeownership counseling program before signing an Agreement of Sale.

In addition to first-time homebuyer and income eligibility guidelines (see chart below), the Turn The Key program will include a preference given to income-qualified City of Philadelphia employees – legislation pending in Council and up for a hearing shortly.

“Public servants are our city’s greatest asset,” said Ernest Garrett, President, District Council 33 of the American Federation of State, County and Municipal Employees. “With the creation of this program, many of those individuals will have the opportunity to own a home — for the first time in their lives — thanks to Council President Clarke, all of City Council, and city housing officials.”

Longtime advocates for affordable housing were present at the news conference.

“At a time when rising housing costs are pricing low- and moderate-income Philadelphians out of the opportunity to buy their first home, this initiative will help ensure opportunities for Black and Brown families to build generational wealth,” said Rick Sauer, Executive Director, Phila. Assn. of Community Development Corporations.

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