New Pennsylvania loan program seeks to expand affordable rentals for at-risk populations

Have a question about Philly’s neighborhoods or the systems that shape them? PlanPhilly reporters want to hear from you! Ask us a question or send us a story idea you think we should cover.

A new statewide program seeks to preserve and expand Pennsylvania’s supply of affordable rental housing for residents at risk of housing instability, including people facing homelessness or escaping domestic violence or human trafficking.

Launched by the Pennsylvania Housing Finance Agency, the $35 million initiative offers 0% interest, deferred-payment loans to private and nonprofit developers, municipalities and housing authorities.

The deadline to apply is 2 p.m. on April 1.

“I would characterize this as so important because it provides a safety net for qualifying populations so that they can benefit the same way other populations can in terms of access to affordable housing,” said Robin Wiessmann, executive director and CEO of PHFA.

The U.S. Department of Housing and Urban Development will administer the initiative with dollars from the American Rescue Plan.

Under the program, 70% of the funding must go to housing projects aimed at helping vulnerable residents in Pennsylvania, regardless of their income, and those at risk of homelessness.

The rest of the units must be affordable to households earning up to 80% of the area median income, a data point that shifts by region. In Philadelphia, that translates to $66,850 for an individual.

“We rely on the market and developers to bring affordable housing to us. And as you might expect, these populations aren’t No. 1 on the list,” Weissmann said. “They’re a little bit more difficult. They create more challenges in terms of management … certainly in terms of economic self-sufficiency.”

PHFA declined to provide an estimate of the number of rental units it expects the new funding to help create or preserve.

Similar to many states, Pennsylvania continues to grapple with a housing shortage, including affordable units. As of 2021, the state needed nearly 100,000 more homes to meet demand, according to a report released by policy research group Up for Growth.

The overwhelming majority of these missing homes are in the southeastern portion of Pennsylvania, which includes Philadelphia and its suburbs, as well as Reading and Lancaster.

Amid an affordable housing crisis, Philadelphia is launching a $2 billion housing plan aimed at creating or preserving 30,000 housing units across income levels. The initiative’s first annual budget prioritizes the city’s lowest-income households.