NYC first-time home buyer programs: help, lotteries and co-ops

NYC first time home buyer programs give you three ways to buy, plus state mortgages, and you can use more than one. The city's HomeFirst program lends up to $100,000 toward a down payment, and you never repay it if you live in the home 10 or 15 years. Housing Connect runs lotteries, random drawings, for lower-priced homes. Some co-op buildings sell only to buyers under an income limit, the most a household can earn.

Those co-ops are Housing Development Fund Corporation (HDFC) co-ops: you buy shares in a building that its residents own together. All three ways to buy are run or overseen by the New York City Department of Housing Preservation and Development (HPD), the city's housing department. The state adds lower-rate mortgages through the State of New York Mortgage Agency (SONYMA).

Which programs can a New York City buyer use?

A first-time buyer in New York City, usually someone who hasn't owned a home in the past three years, can use these programs:

• HomeFirst, HPD's down payment loan for a home you find yourself on the open market.
• Housing Connect lotteries, for new or resold homes priced below market. HPD and the New York City Housing Development Corporation (HDC) pay to build these homes and sell them through Housing Connect.
• HDFC co-ops, apartments in buildings owned together by their residents, sold only to buyers under an income limit.
• SONYMA loans, lower-rate mortgages from the state that work in all five boroughs.

You still need a regular mortgage from a bank or other lender. HomeFirst requires one that meets the rules of an FHA loan, insured by the Federal Housing Administration. A loan that meets the rules of Fannie Mae or Freddie Mac, two companies that buy home loans from lenders, also works. Our guide to HomeReady and Home Possible explains their low down payment loans.

What does the HomeFirst program give you?

HomeFirst gives you a loan with no interest for your down payment and closing costs. Closing costs are the fees you pay at closing, the day you sign the final papers and the home becomes yours. The loan is forgiven if you live in the home long enough. HPD's term sheet sets the loan at 20% of the price or $100,000, whichever is less. It can't pay for repairs. The home can be a one- to four-family house, a condominium or a co-op apartment anywhere in the five boroughs, and you must live in it.

A worked example. A buyer uses HomeFirst for a $450,000 co-op:

1. HomeFirst loan: 20% of $450,000 = $90,000. That is under $100,000, so the loan is $90,000.
2. Your own money: 3% of $450,000 = $13,500, at the least.

The loan reaches its $100,000 maximum on a $500,000 home.

The household income limit, counting income before taxes, is 120% of the area median income, the middle income in the area. HPD's table, effective June 1, 2026:

What are the HomeFirst rules?

• First-time buyer. You haven't owned a home in the past three years.
• Class. You finish a homebuyer course at a counseling agency HPD approves.
• Your own money. At least 3% of the price must come from your own savings, and no more than half of your down payment can be a gift.
• Savings limit. Your household's savings and investments can't be more than the income limit for your household size. Retirement and college savings accounts don't count.
• Price. An existing home must cost no more than the price limit set by HUD, the U.S. Department of Housing and Urban Development, at 95% of the area's middle home price. HPD's HomeFirst page lists it: for a one-family home, $661,000 in the Bronx, Manhattan and Staten Island, $699,000 in Queens and $732,000 in Brooklyn, effective December 1, 2025. A newly built home has a higher limit.
• Mortgage. A fixed-rate loan of 15 to 40 years from a lender on HPD's list, not through a mortgage broker, for at most 95% of the home's value. A loan from the Department of Veterans Affairs can go higher.
• No co-signer who won't live in the home, and no buying from a relative.
• Inspection. The home must pass a housing inspection within 90 days before closing.
• Fee. $1,500: $250 when you apply and $1,250 at closing.

How does HomeFirst forgiveness work?

The HomeFirst loan is forgiven once you have lived in the home for the full period. That is 10 years for a loan of $40,000 or less, and 15 years for a larger one. A loan paid from certain city funds always needs 15 years, so ask your counselor which kind you have.

You must live in the home at least 270 days a year. If you stop living there, you repay the whole loan. If you sell in the first five years, you repay the whole loan, or the money you get from the sale if that is less. You repay it all at once, never in monthly payments. From the sixth anniversary of the loan, the amount you owe drops each year. It drops by 20% a year on a loan of $40,000 or less, and by 10% a year on a larger one.

Take the $90,000 loan above, which needs 15 years. If you sell just after the eighth anniversary, the amount you owe has dropped by 30% of $90,000, so you repay $63,000. If you refinance and the new loan is more than you paid for the home, you pay HPD half of the amount above the price you paid.

How do you apply for HomeFirst?

1. Call an HPD-approved counseling agency in your borough. HPD's HomeFirst page lists them with their phone numbers.
2. Take the homebuyer course and get your certificate.
3. Get a mortgage pre-approval, a letter saying how much a lender will likely lend you, from a lender on HPD's list.
4. Find a home, hire a lawyer and sign a contract.
5. Let your counselor send the HomeFirst application. Once HPD approves the loan, your lender has 120 days to close your mortgage.

Our guide to the homebuyer education class explains what the course covers.

How do homeownership lotteries on Housing Connect work?

Homes that HPD or HDC paid to build are sold by lottery on Housing Connect, the city's site for affordable rentals and homes for sale. After the deadline, every application gets a random number, and the building's sales office reviews them in that order. HPD's Marketing Handbook sets these rules:

• First-time buyers only. No one in your household may own a home or have ever bought one.
• Savings limit. $296,800 from May 1, 2026, as HDC's asset limits sheet shows, not counting retirement and college savings accounts. Some lotteries allow a little more to cover the down payment, so check the listing.
• Income range. Each lottery sets its own lowest and highest income for each household size.
• Gifts. No more than half of your down payment can be a gift.
• Mortgage. You still need a mortgage. The building's credit check only asks whether you can get one. It can't count Housing Court cases against you, and it can't require a co-signer.

Apply once, online or on paper, never both. In your Housing Connect profile, you can also choose to hear about resales, homes sold again by their first owners, under "Housing choices". A seller can't charge more than the maximum price in the building's agreement with HPD.

To see which homeownership lotteries are taking applications today, check our open housing lotteries and Housing Connect.

How do HDFC co-ops fit in?

An HDFC co-op is an apartment you buy as shares in a building that its residents own together. The building pays lower property taxes, and in return it limits buyers' incomes and resale prices. State law limits a buyer's income to 165% of the area median income, and many buildings set lower limits.

Most HDFC apartments are sold through brokers and the building's board, and some are on Housing Connect. Ask the building's board whether it sells through Housing Connect, and read the building's own rules before you make an offer. Our guide to HDFC co-ops explains them.

What does SONYMA add in New York City?

SONYMA offers 30-year fixed-rate mortgages through approved lenders in all five boroughs. Achieving the Dream is its lowest-rate loan, for buyers with lower incomes. The Low Interest Rate Program is its main loan, with higher income limits. For loans whose rate the lender locks in from July 6, 2026, the limits in New York City are:

You pay at least 1% of the price from your own money, or 3% for a co-op or a three- or four-family home. SONYMA's Down Payment Assistance Loan adds $3,000 or 3% of the price, whichever is more, up to $15,000. It is forgiven after 10 years, but it has a cost: your SONYMA mortgage's interest rate is 0.40 percentage points higher with it. If you sell or refinance within 10 years, you may have to repay part of it.

Eligible veterans don't have to be first-time buyers, and neither do buyers in a target area. A target area is a part of the state where federal tax rules give buyers easier terms on state agency loans.

A target area can be a census tract where at least 70% of families earn 80% or less of the state's median family income. It can also be an area of long-term economic hardship that the state names and the federal government approves. Target areas also have higher price limits. Check an address with the lookup tool on SONYMA's eligibility page. Our guide to New York first-time home buyer programs covers SONYMA in more detail.

What should you do first?

Call an HPD-approved counseling agency: it can check your income for HomeFirst, sign you up for the class and send you to lenders. Then check your household against the income limits of homes for sale with our qualify check, and see homes for sale and lotteries on our New York City page.