The Los Angeles City Council approved the expansion of the City’s First-Time Homebuyer Program by increasing the number of loans available to Angelenos and the size of the down payment assistance at each income level. “Los Angeles has been unaffordable for working families for decades and our city cannot ignore the problem,“ said Council President Nury Martinez, who authored the motion. “Hardworking Angelenos should be able to buy their first home and begin building intergenerational wealth for their families. That’s the American Dream and I’m glad we’re doing our part to ensure that it’s still alive and well for L.A.’s families.” In the past 5 years, home prices have increased significantly in Los Angeles. According to data from Zillow, the typical home value in Los Angeles has gone up 48.19%, from $637,000 in February 2017 to $944,000 in February 2022. This has made it difficult, if not impossible, for low- and moderate-income families and young professionals to purchase homes. “After being a renter for most of my life, and as someone who repeatedly faced eviction as a child, I was fortunate to eventually be able to purchase a home here in Los Angeles,” said Councilmember Mitch O’Farrell, who seconded the motion. “I’ve made it my mission to help people who also come from financially disadvantaged backgrounds, so that home ownership is possible for all Angelenos, including families with limited resources.” Nationally millennials are not keeping pace with prior generations, per Investopedia, and this phenomenon is exacerbated by Los Angeles’ outsized typical home value, which is almost three times that of the nation’s.
“The opportunity for home ownership is rapidly falling out of reach for working families in Los Angeles with the average price of a home at one million dollars,” said Councilmember Kevin de León, a seconder on the motion. “The First-Time Homebuyer Program will give families the equitable access they need to realize the dream of homeownership. This program is an essential step toward making L.A. an affordable city.” In January 2022, as a part of her Elevate LA agenda, Council President Martinez laid out her vision to make Los Angeles a livable city for all, including making it easier for L.A. families to build generational wealth through homeownership. This initiative is part of a package of motions that Martinez put forward at the beginning of 2022.
"The Housing Department is excited to have more resources to help first time homebuyers achieve the dream of homeownership in Los Angeles," said Ann Sewill, the General Manager of the Los Angeles Housing Department which will oversee the program. The current program has three income brackets - Low Income, for individuals with incomes up to 80% of the Area Median Income (AMI), set by the U.S. Department of Housing and Urban Development (HUD); “Moderate Income Purchase Assistance (MIPA) 120”, for individuals between 81% to 120% AMI; and “MIPA 150”, for individuals between 121% to 150% AMI. The newly expanded program increases the dollar amount of purchase assistance loans from $90,000 to $140,000 for Low Income Purchase Assistance (LIPA), from $75,000 to $115,000 for those in the MIPA 120 range, and from $50,000 to $90,000 for those in the MIPA 150 range. With the new funding, the new loan ceiling level, and with additional SB 2 funds this year, the number of loans for moderate-income homebuyers will increase by 800% for Angelenos. The funds will be disbursed in the 2022-23 fiscal year. Learn more about the City’s First-Time Homebuyer assistance programs here.