16-05-2025
MaineHousing programs to add hundreds of homes, but the money is running out
May 15—Two Maine State Housing Authority programs are set to help add more than 300 units of affordable housing, including both single-family homes and apartments, to the state's housing stock.
Maine State Housing Authority on Thursday announced $9.3 million for the construction of more than 160 affordable single-family homes and last month announced $23.5 million for 137 rental units in rural areas.
It's the last available pot of money for both the Affordable Home Ownership Program and the Affordable Rural Rental Program, which together will have added 851 new units of housing, making a small but not insignificant dent in the state's lofty goal of adding 84,000 new homes between 2023 and 2030.
The $9.3 million will help build 169 single-family homes across 11 developments stretching from Sanford to Bangor, including 26 homes in downtown Portland. Since its launch in 2023, the homeownership program has helped fund the construction of 325 homes.
These homes will be affordable for households earning up to 120% of the area median income, which for a two-person household in the Portland metro area is $124,600.
The median sale price for a single-family home in Maine reached just shy of $400,000 last year, a price that is unaffordable in all 16 counties compared to their median incomes. Just six years ago, the median home sale price was $200,000.
"This program is putting affordable homeownership back in reach for hundreds of middle-income households and is allowing them the opportunity to claim their own piece of the American dream here in Maine," Dan Brennan, director of MaineHousing, said in a statement.
As home sale prices have increased, so has the cost of construction.
With the high price of land, labor and permitting costs, it no longer makes financial sense to build small houses. Builders have instead favored larger, more expensive projects.
And since most affordable housing programs typically create rental housing, these market pressures contribute to an expanding affordability gap in the single-family market, according to MaineHousing.
Greg Payne, the governor's senior housing adviser, said the additional units will add to Maine's housing supply while bolstering local economies.
"This program has made homeownership possible for hundreds of Maine people, from families buying their first house to retirees looking to downsize while remaining in the communities they love," Payne said.
Last month, a similar program geared toward adding more rental housing in rural areas released $23.5 million in funding to support 137 new rental units in nine communities.
Like the homeownership program, the Rural Affordable Rental Housing Program has now run out of funding, though the Legislature is considering at least two bond proposals that would provide more money for affordable housing production.
The rural rental program seeks to incentivize smaller developments between five and 18 units in parts of the state that might not otherwise have much affordable multi-family housing. Units are available to tenants earning up to 80% of the area median income. In Maine's most rural counties, 80% AMI is $47,600 for a single person.
Since 2022, the program has helped create 229 units.
"The program has not only helped add housing where it is needed most, it is adding development capacity for all of Maine," Brennan said. "This peripheral benefit cannot be understated as we move toward a future that will provide housing opportunities that allow more Mainers to live affordably in a community of their choice."
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