An Ohio state agency sold $145 million in bonds to fund an affordable housing program in the state.
The bonds, issued by the Ohio Housing Finance Agency (OHFA), mature between 2025 and 2055, paying interest at rates between 3.4% and 6%. They received a rating of Aaa from Moody’s Investors Service, which assigned a stable outlook.
“The outlook for the program is stable based on strong financial position as well as the securitized loan portfolio,” according to Moody’s.
The bond proceeds will finance the origination and purchase of loans for first-time homebuyers in Ohio. They will also fund loans to help Ohioans afford down payments.
Across the country, high interest rates have kept would-be homebuyers from purchasing homes, with particularly devastating consequences for low-income renters. In a report published last month analyzing Ohio’s housing needs, OHFA found that low vacancy rates, a shortage of affordable rental units, and rapidly rising rents are all challenging low- and moderate-income Ohioans. Even after adjusting for inflation, rent in Ohio is higher than any other year but 2021. “As rents increase faster than incomes, Ohio renters are finding themselves severely cost-burdened and at risk of eviction and homelessness,” the report’s executive summary says.
The state’s fiscal year 2024-2025 budget contains two initiatives aimed at increasing the stock of affordable housing. The State Low-Income Housing Tax Credit focuses on creating more affordable rentals, and the Single-Family Housing Tax Credit is directed at spurring the development of single-family homes.
The bonds are parity obligations of the agency, payable by mortgage revenue.
Citigroup Global Markets Inc served as lead underwriter on the issuance, purchasing the bonds for par.