Plain-English definition

What is HOME (HOME Investment Partnerships Program) ?

HOME, the HOME Investment Partnerships Program, is a federal block grant that gives states and local governments money to build, buy, or rehabilitate affordable housing. Rental units funded with HOME stay rent- and income-restricted for 5 to 20 years, depending on how much HOME money went into each unit.

HUD sends HOME funds to participating jurisdictions by formula, and each jurisdiction decides which projects get them. The program rules are in 24 CFR part 92. Because the jurisdiction runs the program locally, the layer a property lives with is the written agreement, which can be stricter than the federal floor.

HOME sets two rent limits. The High HOME rent is the lesser of the area fair market rent or 30% of the adjusted income of a household at 65% of area median income. The Low HOME rent is based on 30% of the income of a household at 50% of area median income. In a project with five or more HOME-assisted units, at least 20% of those units must go to very low-income families at the Low HOME rent.

The affordability period scales with the money. Under $25,000 per unit is 5 years, $25,000 to $50,000 is 10 years, over $50,000 is 15 years, and new construction is 20 years. That clock runs on the project, so a property can exit HOME while its LIHTC extended use agreement keeps running.

HOME is almost never the only source. It usually sits under LIHTC, and sometimes under Section 8 as well, which means one unit can answer to two or three sets of income limits at once. The binding limit is whichever is lowest.

Example

A jurisdiction puts $40,000 per unit of HOME money into a 30-unit new construction project. New construction sets the affordability period at 20 years. Six of the units, 20% of them, have to be rented at the Low HOME rent to very low-income households. The other HOME units use the High HOME rent.

Why HOME matters

HOME rent limits are published separately from LIHTC limits and they do not always move in the same direction. On a layered property the compliant rent is the lowest of the applicable limits, so a site that tracks only the tax credit limit can overcharge a HOME unit without noticing until monitoring.

Related terms

LIHTCLIHTC, the Low-Income Housing Tax Credit, is a federal tax credit that pays developers to build and keep rental housing affordable.
Section 8Section 8 is the federal rental assistance program that pays part of a household's rent to a private owner.
RD 515RD 515, also called Section 515, is the USDA Rural Development program that lends money to build and preserve rental housing in rural areas.

How Fortress handles it

Sources

Last reviewed August 29, 2026. Back to the glossary