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Commissioner Rubio Passes Ordinances to Expand Access to Homeownership

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Portland City Council today unanimously passed two ordinances introduced by Commissioner Carmen Rubio to address the ongoing housing crisis — this time with a focus on expanding access to homeownership for low- and moderate-income households.

The first ordinance identifies a nonprofit partner who will work with the City to invest more than $5 million of the City’s federal American Rescue Plan funds to support land acquisition for the development of affordable housing, with an emphasis on homeownership opportunities. Housing developers will be able to use the grants to purchase property and pay for related activities. Once built, the homes will be sold to families at or below 80 percent of the Area Median Income and will remain affordable for 99 years.  

The second ordinance expands a City program that provides incentives for affordable homeownership development. It will allow up to 400 more homes built in Portland each year to receive a property tax exemption if they are sold to low- or moderate-income families. The Homebuyer Opportunity Limited Tax Exemption (HOLTE) program currently offers a 10-year property tax exemption for all permanently affordable homes sold to low-income families, as well as up to 100 additional homes sold to families at or below 100 percent Area Median Income each year. The new, higher cap of 500 homes will remain in place for three years and then the City will analyze the program for effectiveness in boosting production of family-sized middle housing and expanding access to homeownership including for communities of color.

“As the economy recovers from the COVID pandemic, the ability of our nonprofit housing developers to acquire land has a significant impact on the overall development budgets for affordable housing,” Commissioner Rubio said. “Providing resources to developers to purchase land leverages their ability to keep overall development costs low and create housing for low-income residents.

“In addition, building on the HOLTE program’s success will provide added incentives to homebuilders to build new family-sized homes that are affordable to first-time homebuyers,” Rubio continued. “Together, we can continue to respond to the city’s housing crisis with the urgency it demands.”

Preston Korst of the Home Building Association of Greater Portland adds: “This expansion will help more families earning a low-to-moderate income build generational wealth and experience the lifelong benefit of homeownership at a time when too many are being squeezed out of the market by rising interest rates and exorbitant home prices. We applaud the city in taking this important step.”

Steve Messineti of Habitat for Humanity Portland Region and Diane Linn of Proud Ground wrote in a joint letter: “As the region’s largest affordable homeownership developer and the region’s largest Community Land Trust, we see the HOLTE program as a valuable tool to help bring homeownership within reach for households who are priced out of an increasingly inaccessible housing market. A reduction in property taxes translates into increased purchasing power.”

Today’s ordinances are in addition to previous actions Commissioner Rubio has taken to address the housing crisis, including efforts to improve Portland’s permitting process; to incentivize office-to-housing conversions and draw more full-time residents into the city’s core; and to allow deferral of system development charge payments for new housing units.

To follow will come a series of analyses related to the overarching costs of building housing in Portland, local requirements that increase housing development costs, an evaluation of the City’s existing Inclusionary Housing program, and a housing needs analysis — all of which will inform a new housing production strategy for Portlanders for years to come.