During a stop in North Philadelphia’s Fairhill neighborhood on October 30, Philadelphia Fed President and CEO Anna Paulson saw firsthand the impact of community partnerships in promoting homeownership and housing affordability.
President Paulson has been meeting with community leaders, business owners, and residents across the Third District to hear their perspectives on economic conditions. These regional insights help shape the Fed's monetary policy decisions.
"Understanding how people in our region are thinking about and making economic decisions is crucial," she said during her visit. "These insights, combined with economic data, help inform my work representing the region in monetary policy discussions at the Federal Open Market Committee."
A key theme of the visit was the importance of community partnerships to build and sustain vibrant neighborhoods.
During a discussion with community leaders, housing affordability was identified as a top priority. Data show that rising home prices and expenses are putting a financial strain on many Philadelphia households, with roughly 75 percent of low- and moderate-income renters and 26 percent of homeowners allocating 30 percent or more of their monthly income to housing costs. The lowest-income households are spending over 50 percent of their monthly income on housing.
Buying a home is also becoming increasingly difficult. According to the Atlanta Fed's Home Ownership Affordability Monitor, a household earning the median income in Philadelphia would need to spend 50 percent of its monthly income on housing costs to purchase a median-priced home in the county.
Maria Gonzalez, who leads HACE, a community development corporation in the Eastern North Philadelphia area, points to the organization’s efforts to increase affordable housing options for families and to prevent displacement of residents amid rising costs. She said the area has a significant and long-standing Latino population, with many families having lived there for generations. One of HACE’s main goals, she said, is to create more pathways to homeownership.
To achieve this, HACE collaborates with Finanta, a community development financial institution (CDFI) in Philadelphia that focuses on investing in underserved communities. Together, they are working to address the housing challenges in Eastern North Philadelphia, which includes Fairhill and the surrounding neighborhoods, by leveraging Finanta's flexible financing options along with HACE's community connections and development expertise.
During the visit, President Paulson toured Villas del Caribe on West Allegheny Avenue. This development is the second of four sites in the Caribe Development Zone, which covers four acres of previously vacant lots and long-abandoned buildings. Finanta’s financing enabled HACE to create 81 affordable homes, ranging from efficiency units for individuals to larger townhomes for multigenerational and growing families. Several homes can be purchased, and more than a third are available to households using rental assistance vouchers.
Additionally, HACE renovates around 20 homes each year for its homeownership program. Many of the properties are part of the Philadelphia Land Bank’s Turn the Key program, which aims to improve housing quality and keep prices affordable for qualified first-time homebuyers.
The discussion also touched on the significance of financial education and access to financial services. Both organizations provide programs that educate residents on budgeting and credit management in addition to cultivating partnerships focused on helping first-time homebuyers gain the skills needed for successful and sustainable homeownership.
Two of our biggest assets are trust and education. Capital is important, but building and strengthening neighborhoods is done by investing in people. What CDFIs bring to the table is flexibility, expertise, and an unwavering commitment to the long-term investments — like trust, financial education, and listening to the community — that foster lasting solutions.
Daniel Betancourt
President and CEO
Finanta
As the group toured renovated properties — refurbished apartments and townhomes with new kitchens, bathrooms, and sustainable siding — the physical transformation was evident. But the real transformation HACE and Finanta are working toward is less visible: families building credit and savings and staying in neighborhoods where they have deep roots.
“One of the key takeaways from today is the value of partnership,” President Paulson said. “It’s exciting for me to get out into our city’s neighborhoods and see how organizations are working together to support their communities and make owning a home a reality for more residents.”
About President Paulson’s Community Tours
Philadelphia Fed President and CEO Anna Paulson is visiting communities throughout the Third Federal Reserve District to hear the perspectives of residents and communities and to learn about the region’s economy. The Philadelphia Fed serves Delaware, southern New Jersey, and eastern and central Pennsylvania. The insights President Paulson gains will deepen her knowledge of the region and inform her work representing the region in monetary policy discussions at the Federal Open Market Committee.