For too many, the American Dream of homeownership has become a myth - a mirage that feels forever out of reach. Instead, many settle into a lifetime of renting, missing one of the most powerful pathways to housing stability, community investment, and wealth building: the opportunity to own a home.
While both market-rate and affordable rentals are important parts of our housing landscape, they alone are not enough. If we truly want to solve our housing crisis and build a stronger Portland, we must make ownership a reality for more residents.
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If we want to provide housing stability, people must have the opportunity to own, not just rent. • If we want to ensure long-term housing affordability—people must have the opportunity to own, not just rent.
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If we want to create deeply invested, engaged communities—people must have the opportunity to own, not just rent.
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If we want to improve the livability and resilience of our city—people must have the opportunity to own, not just rent.
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If we want to help residents climb the economic ladder and build generational wealth—people must have the opportunity to own, not just rent.
How This Program Would Work
Eligibility
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Single individuals or couples earning up to 120% of Area Median Income (AMI). • Purchase of a single-family home, condominium, or a 2–4 unit multi-family property.
Down Payment Assistance
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Up to $100,000 in assistance.
Terms
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Secured by a second mortgage.
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.5% interest rate, amortized over 30 years (low rate but repayment is important)
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Repayment/Forbearance:
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If the buyer remains in the home and makes all payments, the loan is fully forgiven after 10 years.
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If the home is sold within 10 years, repayment is prorated: 90% repayment if sold in year one, declining by 10% each year thereafter.
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Important:
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No ongoing affordability restrictions: owners are free to sell at market value after repayment or forgiveness, ensuring they can benefit fully from appreciation and wealth-building opportunities.
The Math – Real Numbers for Real Portlanders
Example: Purchase of a $550,000 Home
(Reflecting Portland’s median sale price for Q1 2025)
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$100,000 second mortgage at .5% interest over 30 years ≈ $299/month
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$450,000 primary mortgage at 6% interest over 30 years ≈ $2,698/month
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$5,600 annual property taxes ≈ $466/month
Estimated Total Monthly Payment ≈ $3,463/month
Note: This estimate reflects the high interest rates of today. With lender collaboration—offering lower interest rates and/or 40-year amortization—the monthly payment could be even more affordable. Beyond this owners can re-finance at any time to lower payments if interest rates drop.
Why This Plan Matters
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Ownership is stability: Homeowners are more likely to stay in Portland, invest in their properties, and contribute to the vitality of their neighborhoods.
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Ownership is affordability: Fixed mortgage payments protect owners from the skyrocketing rents that displace so many Portlanders today.
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Ownership is equity: Unlike renters, homeowners build personal and generational wealth through home appreciation.
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Ownership strengthens Portland: Vibrant, stable neighborhoods create a stronger, more resilient city for all.
This plan uses the city's Inclusionary Zoning funds not just to house people temporarily, but to change lives permanently. It gives Portlanders the chance to own a piece of the city they love—and, in doing so, strengthens our entire community.
Research Findings on Down Payment Assistance
For cities looking to utilize inclusionary housing funds effectively, investing in down payment assistance programs offers a research-backed approach to expanding homeownership opportunities and fostering equitable communities.
Addressing Wealth Constraints: A study by the U.S. Department of Housing and Urban Development (HUD) evaluated the potential of down payment assistance programs, such as those provided through the American Dream Downpayment Act, to increase homeownership among low-income and minority households. The study found that cash grants significantly impact the propensity to own by alleviating wealth constraints that limit homeownership. HUD User
Reducing Racial Homeownership Gaps: The Urban Institute highlights that DPA programs are essential in closing America's racial homeownership and wealth gaps. By providing financial support to cash-constrained first-time homebuyers, these programs enable more equitable access to homeownership opportunities. Urban Institute
Overcoming Barriers to Homeownership: Research from the Urban Institute indicates that saving for a down payment is one of the most significant barriers to homeownership, especially for renters. DPA programs can effectively lower this barrier, making homeownership more accessible. North Carolina Housing Finance Agency
City-Level Implementation Examples
New York City: The NYC Department of Housing Preservation and Development offers down payment assistance loans up to $100,000 for first-time homebuyers, aiming to make homeownership more attainable in a high-cost market.
District of Columbia: The DC Housing Finance Agency provides interest-free loans up to $202,000 for down payment assistance, coupled with $4,000 for closing costs, targeting low- to moderate income residents. Brookings
Policy Implications
Implementing DPA programs at the city level can: Urban Institute+6Urban Institute+6North Carolina Housing Finance Agency+6
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Increase Homeownership Rates: By reducing upfront costs, more renters can transition to homeownership. Minnesota Homeownership Center
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Promote Economic Stability: Homeownership contributes to wealth building and community stability.
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Address Housing Inequities: Targeted assistance can help close racial and economic disparities in homeownership.
