Housing Trust Funds

Housing trust funds are powerful tools for providing locally targeted and managed assistance for affordable housing. The funds can have a variety of revenue sources, but among the most common are some portion of the local real estate transfer tax, penalties on late payments of real estate taxes and fees on other real estate–related transactions. Each housing trust fund has a governing body that decides how the funds are used. Some support demand-side solutions, such as subsidizing the down payment on a home purchase by low- to moderate-income residents. Housing trust funds are often used to increase the supply of affordable housing, such as providing zero-interest loans or gap financing for affordable housing new construction or rehabilitation.


  • Source of funding for affordable housing development or preservation.
  • Low-interest loans to developers and nonprofits.

In Practice

Metropolitan Washington Region. The Washington Area Housing Trust Fund (WAHTF) is a housing loan fund that provides substantially below-market interest rate loans to nonprofit and for-profit affordable housing developers in the metropolitan Washington region. As of June 2005, the WAHTF has closed on seven loans totaling $925,000 leading to the creation or preservation of 646 units of housing. Funding activities have a regional focus providing loans to projects in the District of Columbia, suburban Maryland and Northern Virginia.

Washington, District of Columbia. Created in 1988 to support the development of affordable housing in the District, the District’s Housing Production Trust Fund is still continuing success. In August 2002, $20 million was made available for grants and loans for profit and nonprofit developers. The $20 million awarded supported the new construction or substantial rehabilitation of 2,055 units of affordable housing for low- and moderate-income households. Currently, the Trust Fund is aiming to achieve bigger and better goals, such as creating new and affordable housing, the leveraging of other resources, promoting both rental housing and home ownership, and supporting housing for extremely low-income households.

Manassas, Virginia. The Manassas Housing Trust Fund was made to assist low to moderate income families in buying their first home. The program provides customary and normal down payment and closing cost assistance for first time homebuyers in the City of Manassas. The assistance is in the form of a deferred second trust loan for 30 years. The property must be owner-occupied for the 30-year affordability period.

State of Ohio. The Ohio Housing Trust Fund is a flexible state funding source that provides affordable housing opportunities, expands housing services and improves housing conditions for low-income residents. It provides funding for many housing activities including housing development, emergency home repair, handicapped accessibility modifications and services related to housing and homelessness. Adams-Brown Counties Economic Opportunity, Inc. received a $550,000 grant from the Ohio Housing Trust Fund to construct 48 rental units, 12 at Webster Glen and 36 at Webster Greene in Peebles. The Ohio Housing Finance Agency will monitor five assisted units. 

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