State launches One+ housing program

A version of ONE+ had already existed in Boston, but was limited to home buyers living in and purchasing homes within city limits. The new program expands support to Randolph, Framingham, and residents in what are known as Gateway Cities, defined as cities largely composed of communities of color, are entry points for immigrant families, and anchor the state’s economy.

“From day one, our administration has been focused on making Massachusetts more affordable, competitive, and more equitable,” Governor Maura Healey told a crowd of roughly 100 people at the launch at the Lynn housing agency headquarters. “And we are focusing on working with state government, local government, the business community, the nonprofit community — everybody.”

Speakers at the launch said that the expanded initiative wouldn’t have been possible without collaboration between public and private entities. Leaning on a mix of state and philanthropic dollars to combat the state’s skyrocketing home costs, they say, could be one way to eliminate the state’s gaping racial homeownership gap.

“We’re seeing momentum building to bring in companies, foundations, other funders, and organizations that are skilled at this to really figure out how we break the code,” said Nancy Huntington Stager, president and CEO of the Eastern Bank Foundation, which donated $4 million towards ONE+. To address the region’s homeownership barriers, she said, “we need to do things differently.”

In addition to the Eastern Bank Foundation’s donation, ONE+ has received $4 million from a mix of public subsidies and private anonymous donors, as well as $2 million from The Boston Foundation and $1 million from the State Street Foundation. The program organizers hope to raise a total of $25 million through the Racial Wealth Gap Partnership, The Boston Foundation-led initiative to build a team of supporters to promote and facilitate homeownership as a means of minimizing the region’s wealth disparities.

Elliot Schmiedl, director of homeownership at the Massachusetts Housing Partnership, which administers ONE+, said participants could get up to 1 percentage point off of a mortgage through the discounted interest rate, 2 percent in down payment assistance funding, and help with closing costs, which often rise to 3 percent of the home sale price. Schmiedl said incremental supports like those under the program often allow a home buyer to not only purchase a home but also afford to stay in it.

“If they can’t stay in the home, they can’t build the equity,” Schmiedl said. “And if they can’t build the equity, they can’t build wealth.”

Lee Pelton, president and CEO of The Boston Foundation, said that supporting 500 families with $25 million in housing assistance could produce $160 to $170 million in equity over the next decade. And $25 million, he said, “isn’t the ceiling; it’s the floor.”

“Economists, social scientists, policy makers, and academics have cited a variety of approaches to closing the racial wealth gap,” Pelton said. “I settled on this approach because it’s measurable.”

Massachusetts has made some progress in narrowing racial homeownership gaps, but disparities still exist.

As of 2021, 73 percent of Greater Boston’s white households headed by an adult 35 or older own homes, according to a 2023 report from Boston Indicators, The Boston Foundation’s research arm. More than two-thirds of Asian households are homeowners. But by contrast, only two in five Black families in the region are homeowners, and 37 percent of Latino families own homes.

The Bay State’s exorbitant housing costs make it even harder for first-time home buyers. Though the median sales price for a single-family home in Greater Boston has cooled down from the summer’s near-million mark, it was still $850,000 in September, according to a Greater Boston Association of Realtors report.

The majority of Black and Latino households have been largely shut out of the Boston housing market due to historic redlining and its high home costs, but have made up a larger share of home buyers in the state’s 26 Gateway Cities. According to the Partnership for Financial Equity and the Woodstock Institute, Black and Latino homebuyers received roughly two in every five mortgages in these communities.

Still, Gateway City residents are finding it increasingly harder to own in the communities they grew up in, said Lieutenant Governor Kim Driscoll. That is why the new initiative focuses largely on Gateway communities, she said.

“The Gateway Cities … that used to be livable, that were once the affordable places to live, too often they’re not too affordable,” Driscoll said.

Lynn Mayor Jared Nicholson said ONE+ would undoubtedly benefit his constituency, considering half of Lynn’s residents are spending more than 30 percent of their paychecks on rent and lack the capacity to save towards a home.

Lynn resident David Jiles said he has seen the support that assistance programs can provide. He said he moved to Boston as a graduate student with “$76 in my bank account, no savings, and nearly nine months of overdue car payments.” He didn’t see homeownership in his future, but was able to purchase one through the discontinued MassDREAMS grant program.

More public and private partners investing in homeownership programs like ONE+, he said, could make stories like his more widespread.

“The extension of ONE+ mortgage is one more step towards creating extraordinary opportunities for everyday people,” Jiles said.

This story was produced by the Globe’s Money, Power, Inequality team, which covers the racial wealth gap in Greater Boston. You can sign up for the newsletter here.

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Tiana Woodard can be reached at tiana.woodard@globe.com. Follow her @tianarochon.