Housing (Housing Finance)

HB 5314 updates Connecticut's "Homes for CT" loan program to set a clear interest rate cap: loans from participating financial institutions must charge a rate not exceeding The Wall Street Journal's published prime rate (replacing a previous Federal Home Loan Bank reference). It also expands the Connecticut Housing Finance Authority's role, allowing it to provide additional loans or forgivable grants-in-aid to eligible borrowers beyond those from banks, with these new loans being subordinate to bank loans. The changes directly affect Connecticut homebuyers (particularly first-time buyers) who qualify for the program through participating lenders. The bill takes effect July 1, 2026, and aims to streamline program administration while maintaining affordability.

HB 5063 reduces the sales and use tax rate for construction and building materials used in housing to 2%. This directly affects builders, contractors, and homeowners involved in new home construction or housing rehabilitation projects. The bill amends tax code to lower the rate from its current level specifically for materials stored, used, or consumed in housing projects. It does not change tax rates for other materials or non-housing construction.

HB 5361 requires municipalities to establish or designate an agency to implement affordable housing programs based on income criteria for units built under certain regulations. Municipalities must act within 120 days of a zoning commission's request to create such a program, or the housing authority must take over. The law mandates non-discriminatory selection processes for affordable housing applicants, prohibiting bias based on factors like race, gender, disability, or veteran status. This bill directly affects local governments and housing authorities, effective October 1, 2026. It revises housing statutes to standardize how affordable housing is managed and allocated.

HB 5162 amends Connecticut's bond authorization for the Connecticut Housing Finance Authority (CHFA), expanding the use of $38 million in funds to cover both emergency mortgage assistance and down payment assistance under the state's homeownership loan program. This change directly affects CHFA and Connecticut homeowners participating in the homeownership loan program (sections 8-283 to 8-289 of state statutes). The bill modifies existing funding rules to permit the same $38 million to capitalize down payment assistance, which was previously ineligible under this specific bond authorization. The amendment takes effect July 1, 2026.