Legislators Could Green Light Savings Program for First-Time Homebuyers
Legislation that would create a First-Time Homebuyers Savings Account Program in Pennsylvania was re-introduced in the both Pennsylvania House and Senate in the 2019-2020 legislative session. House Bill 128 (Brown, R-Monroe) has moved to the Senate for consideration, while companion legislation, Senate Bill 309 (Mensch, R-Montgomery) moved to the Senate Appropriations Committee in April.
The program would allow Pennsylvanians to save money toward the purchase of a home and the money saved would qualify as a tax deduction on their state income tax. Parents and grandparents would be eligible to save for children and grandchildren as well. And research from the National Association of Realtors® shows that more than 80 percent of Pennsylvanians support the First-Time Homebuyers Savings Account program.
“Pennsylvania Realtors® worked tirelessly during the last legislative session to move this bill,” said PAR President Bill McFalls Jr. “It received overwhelming support, but the legislature ran out of time at the end of the year before either bill was passed. We’re pleased that these legislators recognize the importance of homeownership and see the need to help Pennsylvanians achieve the dream of owning a home. The program would also provide a boost to the state’s economy.”
Many first-time homebuyers need help overcoming obstacles to homeownership. Low wages and college debt make it difficult for young people to save money to purchase their first home. Research conducted for PAR showed that 56% of Pennsylvanians identified college student loans as an obstacle to homeownership. A study by LendEDU ranked Pennsylvania as having the highest average college loan debt per borrower at $35,185.
The First-Time Homebuyers Savings Account Program could result in an increase of home purchases of up to 4,000 annually in Pennsylvania, according to research conducted by the Anderson Economic Group. The increase in the number of home purchases would have an overall positive impact on Pennsylvania’s economy, spurring additional economic activity and job creation. It’s estimated that the economic impact could range up to $68.8 million. The increase in state tax revenues collected from realty transfer taxes, income taxes on increased earnings and sales taxes on increased consumption would exceed tax revenue forgone due to FHSA deductions.
To learn more about the proposed Pennsylvania First-Time Homebuyers Savings Account Program and to contact your legislators, visit FirstHomePA.com.