LIMITED EQUITY HOME OWNERSHIP PROGRAM
All Agency sponsored affordable homes, whether new or resale, are part of the Limited Equity Home Ownership Program (the "Program"), described below.
Eligiblity Requirements
Must meet all of the following:
- First-time Homebuyer: Homebuyer cannot have owned any residence in the past three years.
- Income Eligibility: Current total household income (including an asset calculation) cannot be more than the designated percentage of Area Median Income ("AMI") for the home. Income includes all sources of income for each household member aged 18 and over.
- Down Payment: Homebuyer must make a minimum 5% down payment, which will vary based on the sales price of the home. Of the total 5%, 3% needs to be the homebuyer's own funds (held in a financial institution) and 2% can be gift funds (not yet received). Total down payment cannot exceed 50% of the sales price.
- Program Restrictions: Homebuyer must read and sign all Agency documents, and agree to the occupancy and resale restrictions of the Program.
- Household Size: The Program offers a range of studios to four-bedroom homes. We require a minimum of one person per bedroom. In addition, all unrelated members of the household must live together at the time of application.
- Mortgage: Homebuyer must be able to qualify for and obtain a first mortgage from an accredited financial institution, underwritten to Agency standards: 30-year, fixed rate loan, no mortgage insurance, and the inclusion of all adults aged 18 and over on title and loan. Details about Preferred Lenders are available in the application for each housing opportunity.
- Preference: First preference for all affordable home sales is given to Certificate of Preference holders. San Francisco residents and workers also received preference. Other preferences may apply per project.
About the Limited Equity Home Ownership Program:
Generally, affordable homes are priced for and restricted to households earning between 55% and 120% of AMI, with emphasis on households earning less than 100% of Area Median Income.
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All of the Agency's affordable homes are now part of the Program.
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The Program is designed to provide home ownership opportunities to qualified low- and moderate-income households who otherwise would be unable to purchase a home in San Francisco.
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The Program's main goals are to create permanently affordable homes and to offer participants an alternative to renting that enables them to build equity, and enjoy tax deductions and other benefits of home ownership.
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Buyers who meet Agency eligibility criteria can purchase homes at affordable prices. In return, when they are ready to sell, participants must sell the homes to eligible households at affordable prices. This system allows many generations of homebuyers to access affordable homes.
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The initial purchase and subsequent resale prices are linked to affordability at specific percentages of AMI. Therefore, owner equity is determined largely by the buying power of the new, eligible buyer at the time of resale, and not by the market value of the home.
Please visit the GETTING STARTED section for next steps.
Lenders (and their team members, including underwriters and appraisers) should refer to the INFORMATION FOR LENDERS page.
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