Homebuyer Choice Program
Where you live matters. For many low- and moderate-income Houstonians, buying a home at an affordable price limits neighborhood choice. The City of Houston’s Homebuyer Choice Program, run in collaboration with the Houston Community Land Trust (HCLT), seeks to make quality homes in any neighborhood affordable.
How Does it Work?
The Homebuyer Choice Program subsidizes the purchase of Houston homes using two tiers:
Tier 1
For homes zoned to A- and B-ranked schools, the City will provide up to $150,000 towards a home purchase.
Tier 2
For all other neighborhoods, the City will provide up to $100,000 towards a home purchase.
The Homebuyer Choice Program uses these subsidies to significantly reduce the price of a home. The homebuyer contributes what they can afford ($70,000 or higher, depending on income) to the home purchase, usually in the form of a standard mortgage. The City's financial assistance grant helps cover the rest of the home's purchase price, as well as the buyer's reasonable closing costs. In receiving this subsidy, the buyer agrees to place the land beneath the home in trust with the Houston Community Land Trust (HCLT). This means the homeowner owns the home itself, while the community land trust owns the land beneath, stewarding it for the benefit of the homeowner, future homeowners, and the community as a whole. Even though they will share ownership of the land with the HCLT, the homeowner keeps the exclusive right to use and enjoy the land beneath their home and takes on the responsibilities of upkeep and maintenance of a typical homeowner. Learn more.
This program has three main stages:
Stage 1: Eligibility
- Homebuyer prepares for the program (see Initial Steps section below)
- Homebuyer applies through the HCLT’s Application
- The HCLT works with the homebuyer to make sure that they qualify
- Once approved, the homebuyer will receive a Qualification Letter from HCLT
Stage 2: Inspections and Underwriting
- Once the homebuyer selects a home, the HCLT will submit necessary documents, including the home’s contract and subsidy information, to HCD
- HCD will conduct an environmental review – no home that fails an environmental review can participate in this program
- HCD will conduct inspections for health and safety
- If the home fails the inspection, HCD will allow for repairs and perform another inspection after repairs are made, up to 2 times
- The homebuyer will also need to schedule an independent inspection to meet the standards of the Texas Real Estate Commission (TREC)
Stage 3: Closing and Funding
- HCD and the HCLT will work together in the underwriting process
- HCLT will provide their wiring information
- HCD will wire subsidy funds to the title company directly.
Am I Eligible?
If you meet the basic criteria, you may qualify for the Homebuyer Choice Program:
- Earn at or below 80% of Area Median Income
- Are prepared to make a significant contribution to the purchase of the home, as follows:
- At least $350 out-of-pocket to the down payment
- Maintain at least $1,000 in savings for use after closing
- Bring a mortgage, or other funds to their purchase, called the Homebuyer's Contribution. The minimum contribution is $70,000, but may be higher depending on the home-owner's income level.
- Are not currently a homeowner.
Your property will also need to meet these requirements:
- Located within the City of Houston’s jurisdiction. (Enter an address into our map to check. .)
- A Single-Family home or detached townhome – no condominiums, co-operative housing units, manufactured homes, or mobile homes will apply.
- Up to environmental standards
- Outside of the floodway and 100-year floodplain
- If in the 500-year floodplain, insured and compliant to floodplain ordinances
- In good condition, meeting health and safety standards (not a fixer-upper home).
First Steps
In order to apply to this program, you will need to follow the instructions set out by the Houston Community Land Trust. Please make sure that you understand eligibility requirements (see section above) as you complete these steps:
Find a realtor to begin looking for your future home. (See a list of realtors who have worked with us before. )
Attend an 8-hour Homebuyer Education course at an approved location.
Obtain a pre-approval letter for a fixed-rate mortgage from one of HCLT’s approved lenders.
Once you are ready, please gather your documents and apply through the Houston Community Land Trust’s page.
What Happens Next?
All applications must be screened and approved by the HCLT. After your initial approval, you will receive a Qualification Letter from the HCLT. At this point, you can begin shopping for a home.
When you have secured a home, the HCLT will send required documents to HCD. At this point, we will begin the underwriting process and prepare your funds. The environmental review & inspection will be done, and funds will be sent to the homebuyer through the HCLT. HCLT should be your main point of contact for this process.
Resources
| Name | View |
|---|---|
| Homebuyer Choice Program Lunch & Learn | Workshop Replay |
| Program Guidelines | Program Guidelines |
