A $10K incentive opens the door to homeownership for city employees
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In a bid to attract and retain workers, Baltimore will double its financial incentive for city employees who purchase a home in one of its “middle neighborhoods.”
For decades, Baltimore has struggled with a declining population. Between 2010 and 2020, roughly 35,000 people left, a 6% drop in population. Like other older industrial cities—Cleveland, Detroit, Philadelphia, St. Louis—Baltimore has lost the vast majority of its manufacturing jobs in the last half-century. And as the manufacturing jobs have left, so have many of its homeowners. For years, Baltimore has been focused on shoring up homeownership in the city, but now it’s turning that focus on municipal employees and “middle neighborhoods.”
Earlier this month, Mayor Brandon Scott announced the expansion of the City Employee Homeownership Program to give municipal workers up to $10,000 to put toward a home in one of its middle neighborhoods, areas that are neither exceedingly affluent nor distressed and that play a crucial role in maintaining urban stability and community well-being. Middle neighborhoods, which are home to middle- and working-class families, are typically areas where housing is affordable.
Under the existing program, city employees are given $5,000 in down-payment assistance. But for the next year, recipients will receive double the amount for homes purchased in select middle neighborhoods. The expanded program, according to a press release, is an effort “to highlight the city’s middle neighborhoods strategy and empower its dedicated city workforce.”
Baltimore’s initiative could be the start of a trend amid an affordable housing crisis and an effort by governments to attract and retain workers, according to Cara Welch, CEO of the Public Sector HR Association.
A June report by the group found that only about 3% of state and local agencies currently offer homebuying assistance. While relatively small, Welch said that’s the largest share the survey has found since its first edition in 2009.
Many agencies are already creating education resources to help workers manage their finances, including paying off student loan and credit card debts, making large purchases like homes and saving for retirement.
“[We’re] starting to see some of these local governments go the next step to actually providing some down payment assistance for housing,” Welch said.
Baltimore is taking things a step further. Typically, housing assistance targets public sector professions working in law enforcement and teaching, but Charm City is offering homebuying assistance for all city employees.
“As a widespread program, I would say that's fairly new … but something that local governments are absolutely looking at,” Welch said.
Indeed, Hartford, Connecticut, Mayor Luke Bronin announced a similar program in January. Like Baltimore, its $1.25 million forgivable loan program provides up to $10,000 in down payment assistance for municipal employees who purchase a home within the city.
Baltimore also sees the program as a way to retain employees, according to Annie Milli, executive director of Live Baltimore, a nonprofit helping facilitate the program.
“Research suggests that when people live closer to their work, and when people are invested in a home near where they work, they are more likely to stay in that job,” she said.
“Owning a home means building a community, building wealth and building a legacy,” Mayor Scott said in a statement. “We’ve made so many investments in ensuring that homeownership is still an achievable dream in Baltimore, and I wanted to ensure that Baltimore City’s own employees are supported in pursuing it.”
There are a handful of requirements for those taking advantage of the incentive, including completing a homeownership counseling program before making an offer on a home.
“We know that there are many city employees who live in Baltimore but rent,” Milli said. “Helping them to become homeowners is a way of ensuring that no matter what happens with the price of housing, they will have the opportunity to stay in the neighborhoods that they love.”
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