Gov. Katie Hobbs announced the expansion of a first-time homebuyer assistance program her office launched last year, but it’s unclear how long the state can keep the Arizona is Home initiative going as its funding sources begin to run dry.
Hobbs launched the program last year using $10 million from the state’s Housing Trust Fund and $3 million in federal COVID-19 relief dollars, which was used to provide qualified first-time homebuyers across the state.
Hobbs has now allocated an additional $5 million from Arizona’s share of federal pandemic relief money. That's enough to provide $9,000 for 75 would-be homeowners in Pima County. The Governor's Office said the additional dollars should help to purchase 65 homes in Maricopa County.
According to the Governor’s Office, the program has helped Arizonans purchase 589 homes.
With the new dollars, the total number of Arizonans getting a financial bump from what is called the Arizona is Home program should reach 1,000.
“Arizona is Home — it was our path to home ownership,” Mesa resident Tanner Swanson said.
Swanson and Angelica Villarreal moved into their Mesa townhome earlier this year, just a few weeks after their 4-month-old son Kylan was born.
“Not owning a home and starting a family, that's not — it doesn't feel safe,” Swanson said. “It's not something that you want to do, and so as soon as we knew we were having a kid, we started planning to purchase a home, but it's really hard to make that happen.”
Hobbs said she empathized with that story, telling the new homeowners her family experienced a foreclosure in 2010 and said homeownership sometimes “felt out of reach” before her family was able to purchase a home a decade later.
“I know how important it is and having that stability for your family, and so I'm really glad you were able to get your home through this program,” she told them.
Future funding is uncertain
Hobbs said she is hopeful the state can keep the Arizona is Home program going after the most recent round of funding runs out, but she acknowledged she will have to find a new pot of money.
“Most of the funds for this program have come through [American Rescue Plan Act] dollars, and we've exhausted most of those,” Hobbs said, referring to the federal COVID-19 relief money. “So we'll continue to look for opportunities; hopefully, with the success, it'll be something that the Legislature is interested in helping us continue.”
But some legislative Republicans have already expressed skepticism about Arizona is Home.
Rep. Jeff Weninger (R-Chandler) told a legislative committee in February that he didn’t believe the Hobbs Administration had “budgetary authority” to use the fund for down payment assistance.
Last session, Republicans on the House Appropriations Committee attempted to insert a clause proposed by Weninger into state law stating that “except as authorized by law, fund monies may not be spent on any down payment assistance programs that aid with the purchase of properties in this state.”
That would have meant Hobbs couldn’t use the state Housing Trust fund to pay for the program without legislative approval.
That amendment did not become law, but lawmakers did approve new language requiring the Arizona Department of Housing to prioritize constructing or renovating shelters and transitional housing units when spending Housing Trust Fund dollars.
Weninger argued helping individual homebuyers is less effective than using state funds to increase Arizona’s housing supply.
“I just don't think we're getting the bang for our buck with that program,” he said.
Weninger said he preferred programs like Arizona’s now-defunct Low Income Housing Tax Credit, or LIHTC, which can be used to incentivize the development of affordable housing projects.
Everything is on the table
Hobbs said the state should pursue both avenues.
“We can do both,” Hobbs said. “Building more affordable housing is important, but helping Arizonans achieve their dream of home ownership is also really critical.”
Standing outside of Swanson’s townhome, she added, “You saw firsthand here. This family is able to provide stability for their son, and that's so critical.”
But, so far, negotiations over legislation designed to increase the state’s housing supply have mostly stagnated.
For instance, despite support from both Hobbs and Weninger, Arizona became the first state to create and then kill a low-income housing tax credit after a proposed renewal faced opposition from some legislative Republicans, including Senate President Warren Petersen.
A bipartisan coalition of lawmakers seeking to make it easier to build homes in Arizona by removing municipal red tape have found limited success in passing some bills, such as legislation making it easier to build accessory dwelling units like casitas. But Hobbs vetoed a larger omnibus housing package backed by the group in 2024 and a revised version stagnated at the Legislature this year.
How to apply
First-time homeowners can apply for the down payment assistance program if they meet certain criteria, including not owning property over the past three years and living in Arizona for at least six months.
Applicants in Maricopa and Pima counties must have an income at 120% or below the Area Median Income. In Maricopa County, that’s $131,520. In Pima County, it is $115,320.
A full list of criteria and instructions on how to apply are available on the Arizona Department of Housing website.
Howard Fischer with Capitol Media Services contributed to this report.
