The economic impacts of the COVID-19 pandemic on Ohio homeowners have been felt statewide. A combination of job loss, inability to work due to sickness, and other factors left many Ohioans struggling to keep up with home-related costs.
OHFA's Save the Dream Ohio (SDO) program provides funding to homeowners who have been financially impacted by the pandemic, with the primary goal of preventing mortgage delinquencies, foreclosures, and other negative housing outcomes. SDO is comprised of two parts: the Mortgage Assistance program, which OHFA administers, and the Utility Assistance Plus component administered by OHFA in partnership with local Community Action Agencies and nonprofit organizations.
Statewide homeownership data helps inform SDO program policy, while applicant characteristic data elucidates where assistance is most needed. Prior to establishing SDO, the 2021 OHFA Ohio Housing Needs Assessment indicated that 67% of those earning less than 30% of the Area Median Income (AMI) in Ohio are severely cost burdened. That means they are spending 50% or more of their income on housing-related expenses.
This is reflected in the SDO applicant data. Of the applicants making below 30% AMI, 60% are either cost burdened or severely cost burdened, compared to 36% of applicants with an AMI between 30-60%1. As of the end of July 2022, more than $17 million in funding has gone to help applicants most at risk for housing cost burden with average assistance amounts of $1,900 for households earning between 0-30% AMI and just over $1,800 for households with AMIs between 30-60%.
Much of the SDO funding goes to assisting homeowners who are or may become delinquent on their mortgage payments, which is usually a household's largest expense. Analysis revealed the median applicant earning less than 30% AMI spends 56% of their monthly household income on mortgage payments (Figure 1). SDO helps mitigate these costs with direct payments to mortgage lenders through the Mortgage Assistance component of the program.
Figure 1: Median Cost Burden of SDO Applicants by AMI Category
Data analysis also showed that applicants tend to have different housing affordability needs depending on whether they live in a predominately rural or urban county. In Ohio, rural homeownership rates are significantly higher than those in urban areas (74% and 46%, respectively). This disparity is most likely due to urban areas having higher proportions of multifamily rental properties. However, despite having a lesser rate of homeownership, homeowners who live in primarily urban counties make up a significant share of the SDO program with 38% of the applicants coming from Cuyahoga, Franklin, and Hamilton counties and accordingly have received 42% of the total current disbursed funding (Figure 2).
Figure 2: Distribution of SDO Applicants by County
OHFA will continue to analyze SDO program data to ensure that funding reaches those households most in need. Helping to relieve the financial burden for Ohio homeowners that have been impacted by the pandemic today goes a long way in ensuring families can remain in their homes tomorrow and for years to come. If you or someone you know needs home-related financial assistance, please visit Save the Dream Ohio.
1 "Cost burden" is calculated by dividing monthly mortgage payment by household monthly income and is defined by the U.S. Department of Housing and Urban Development (HUD) as spending at least 30% of income on housing-related costs. "Severe cost burden" occurs when a household spends at least 50% of income on housing-related costs.