Less than four months after the D.C. government replenished funding for the city’s first-time homebuyer assistance program, all of its $26.2 million has been reserved, a public dashboard shows — meaning that many people currently attempting to buy a home with the help of the District’s Home Purchase Assistance Program will have to wait until October to seek funding.

HPAP provides interest-free down payment assistance to low- and moderate-income first-time homebuyers, with repayments for lower-income buyers deferred until the property is sold.

The D.C. government has struggled with how to administer the program in recent years as demand for housing assistance grows. In 2022, Mayor Muriel Bowser announced the program would more than double the amount of assistance that residents could be eligible to receive, from $80,000 to $202,000. But HPAP funds ran out in June, more than three months before funding for the program would reset in October. The drawdown in funding startled homebuyers and agents, who told DCist/WAMU that they did not receive a warning from the Department of Housing and Community Development that the program’s budget was nearly exhausted.

Program rules changed again in the fall of 2023 when DHCD told applicants that they would only be eligible to receive assistance capped at 30% of the home purchase price, a decision ostensibly designed to stretch HPAP funds further by reducing the amount of each individual award. Program participants lamented at the time that the new rules would shut many low-income buyers out of the market altogether.

Real estate agents and government watchdogs say it’s not uncommon for HPAP funds to run out before the end of the fiscal year. But some have criticized how DHCD has administered the program, arguing that fluctuating program rules make sellers wary of working with HPAP clients.

Councilmember Robert White, who chairs the council’s housing committee, says the new program rules helped create a “perfect storm” that made accessing HPAP funds more difficult. “The cost of housing was going up, interest rates were going up. [The new regulations] limited the number of people who could take advantage of the program.”

“Houses cost a lot in the District, which means if we’re going to give assistance in a meaningful way, we’re going to have to give a lot. … I don’t agree with [the new program changes] because what you essentially do is pull out of the eligible population the people with the lowest income. Those are the people who will need HPAP to cover a higher percentage of their home purchase,” says White, who introduced an emergency bill in December that would have exempted prospective homebuyers who were approved for HPAP funds during the previous budget cycle from the Bowser administration’s new program rules.

“This modification will have the most severe impact on potential Black homebuyers, which is something that the mayor has said is a priority, [and] which is something that I hold as a priority.”

Although the council unanimously passed White’s emergency bill, the fickle and fast-paced nature of the housing market means that the bill’s implementation likely came a hair too late for those who needed it. Bowser didn’t sign the bill until Jan. 11, the day HPAP funding ran out for the current fiscal year; consequently, most eligible residents who have not yet secured funding through the program will now have to wait until the fall for HPAP funds to replenish.

“There’s more demand for this program than there is money in the pot, and we could double it, and that would still be the case,” White says.

The demand for HPAP funding parallels that for other housing assistance, like the Emergency Rental Assistance Program, which helps prevent evictions by providing eligible residents with money to pay back rent and court fees. The application for ERAP closed just hours after it opened on Jan. 2, and will not reopen until April.

By Jan. 9, DHCD’s dashboard for HPAP funds showed that the program had dwindled to $2 million in remaining funds, and by Jan. 10, $1 million. On Jan. 11, it reported that all program funds were reserved for existing customers. A spokesperson for DHCD did not immediately respond to DCist/WAMU’s request for comment.