Money Can Also Be Used to Build Accessory Dwelling Units
The Town of Southampton is dedicating Community Housing Funds (CHF) for two new housing programs aimed to assist people living or working in the Town. The Town Board has given the go ahead for a First Time Homebuyer Down Payment Assistance Program and Accessory Dwelling Unit Program that are part of a broader strategy to address housing affordability using the CHF, the dedicated housing fund created in 2022 and put into effect one year ago. The CHF fund draws revenues from a half-percent tax on most local real estate sales.
The town will begin offering first-time homebuyers with down payment assistance of up to 3% of a home’s purchase price to eligible homebuyers who live or who are employed in the Town. The First Time Homebuyer Down Payment Assistance Program aims to help local residents or employees achieve their dream of homeownership in the Hamptons by providing crucial financial assistance for down payments. The program is designed to alleviate the financial burden that often prevents first-time buyers from entering the housing market. By offering substantial down payment support at 0% interest, the Town of Southampton hopes to make homeownership more accessible and affordable for local and working people who have been priced out of the Hamptons real estate market.
“The town board was unanimous in its support of the two new housing assistance programs, and we are committed to allocating additional CHF funds to create workforce housing opportunities for our community. We’re putting words into action, with thanks to our residents for their support,” said Supervisor Maria Moore.
“Affordable housing continues to be a critically important initiative for Southampton. As we seek to expand opportunities to our local workforce, these two new CHF programs will be integral to the success of future generations and the sustainability of our tax base,” said Councilmember Michael Iasilli.
The total initial funding allocated to the First Time Home Buyer Down Payment Program is $1.25 million. First Time Home Buyers who live or work in the Town; whose income does not exceed 100% of State of New York Mortgage Agency (SONYMA) limits (currently, $184,680 for up to two persons and $215,460 for three or more persons) and the price of the home cannot exceed 150% of the SONYMA purchase price limits (currently, $1,665,600). Borrowers must occupy the home as their primary residence.
Borrowers will receive assistance of up to 3% of the purchase price of the home at 0% interest, only due to be re-paid upon the sale or refinance of the home and may be combined with SONYMA loans of up to $15,000.
The second program is a no-interest construction loan for local homeowners who want to add an affordable accessory dwelling unit to their home in order to house a member of the Town’s workforce.
The Accessory Dwelling Unit (ADU) Program provides two benefits. First, existing homeowners will have the ability to construct an accessory dwelling unit on their property that will help generate extra income helping them to afford rising expenses and allowing them to maintain their current residence within the town. Second, ADUs provide an affordable housing option for the town’s workforce so that they can live in the town where they work.
Borrowers must own the property and reside at the property as their primary residence; Tenant income must be 130% AMI or less; at least one tenant must work full-time at a business located within the Town of Southampton; rent charged may not exceed the affordability guidelines set by the Town. Up to $125,000; 20-year loan, 0% interest; payments begin in year two.
“Homeownership and the ability to live where you work are cornerstones of a stable and thriving community,” said Kara Bak, The town’s director of housing and community development. “These new programs are a testament to the Town’s commitment to supporting its residents and the local workforce, ensuring that the Town of Southampton remains a place where people can put down roots and build their future and the future of our township.”
“Housing all over the East End of Long Island has reached crisis levels. These programs created by the Town of Southampton will go a long way in helping people find suitable places to live in our community,” said Councilmember Tommy John Schiavoni.