PHA renters can divert rent increases to a savings account to buy a house. But few do.

As Dwayne Fair’s mother lay dying a decade ago, she asked him to make a promise. Whatever you do, she said, don’t let go of the house.

Their family had made decades of memories in the North Philadelphia home she had rented from the Philadelphia Housing Authority since he was 4.

“Until my mother passed, we never even thought about purchasing that home,” Fair, 58, said.

With the help of a federal program through PHA that helps residents build their savings and learn financial planning, he bought the family house last March.

“As soon as I got the deed, I immediately went to the cemetery,” he said. “I told my mom, ‘I did it.’ I committed, and I did it.”

» READ MORE: Philly-area homeowners are building wealth quickly, thanks to rising prices

The program that currently enrolls about 1,000 PHA residents will expand to 4,000 over the next five years thanks to a $2.5 million grant from the Pew Charitable Trusts. Through the U.S. Department of Housing and Urban Development’s Family Self-Sufficiency Program, PHA creates free savings accounts for families that use housing subsidies. The expansion of PHA’s program would make it the largest in the country.

Households in subsidized housing pay a percentage of their income — typically 30% — toward rent. So as their income goes up, so do their rent payments. The federal Family Self-Sufficiency Program, started three decades ago to increase earnings and reduce dependency on public assistance, puts that additional rent money into an interest-building escrow account.

After about five years, households can use the accumulated funds however they want, including to purchase a home, pay for education, build emergency savings, or pay down debt.

» READ MORE: It’s no easier for Black Philadelphians to become homeowners now than it was 30 years ago

“Home ownership is a strong driver for folks,” said Markita Morris-Louis, chief executive officer of Compass Working Capital, the national financial services organization that has run the Family Self-Sufficiency Program for PHA for the last three years and received the Pew grant. More than 100 PHA residents have graduated from the program since 2019.

Across Compass Working Capital’s programs in Philadelphia and Massachusetts, the average household’s escrow account totals about $8,500. Some have saved $20,000. Graduates of the savings programs earn higher incomes and rely less on public assistance.

Often, families’ increases in income are not enough to compensate for the loss of benefits or increased expenses, so households feel penalized for succeeding, said Morris-Louis, who also is on the board of the Pennsylvania Housing Finance Agency.

“Families often feel like they’re trying to take one step ahead, but, ‘I feel like I’m getting pulled two steps behind,’ ” she said.

» READ MORE: Owner of West Philly subsidized townhouses plans to sell, displacing dozens of families. It’s an example of the vulnerability of affordable housing.

She and PHA emphasize that households don’t lose anything by joining the program. If they don’t enroll, their rent payments increase with their earnings. If they do, the additional money they would have spent in increased rent goes into savings to build their assets.

On top of about $360,000 in federal funding, Compass Working Capital plans to use the Pew grant to support hiring more financial coaches, reach more residents, tailor its online enrollment portal, and manage the larger program. Its long-term goal is to enroll the tens of thousands of additional PHA households that could benefit.

» READ MORE: PHA has chosen New York developers to transform a West Philly apartment complex

Roughly 2.2 million households nationwide are eligible for the program, but only about 65,000 are enrolled, Morris-Louis said. Many families are focused on meeting their day-to-day needs and don’t have “the luxury” of thinking about the future, she said.

Through the program, financial coaches help households set achievable goals while connecting them with child care and other supports. Compass Working Capital partners with the Philadelphia-based financial counseling nonprofit Clarifi.

The federal program is part of a larger PHA initiative to help its renters become homeowners through financial planning, grants, and job training. Fair was one of 90 PHA renters last year who bought homes — a record for the agency.

“There is a lot of folks who can benefit tremendously from such a program, but they need to get the information, and they need to feel secure in going through it,” said Kelvin Jeremiah, PHA’s president and chief executive officer.

The Family Self-Sufficiency Program is part of PHA’s goal to help residents — among the city’s most vulnerable — to achieve economic independence.

“I think we’re making important strides toward that objective,” Jeremiah said.

Kristin Romens, project director of the Pew Charitable Trusts’ Fund for Health and Human Services in Philadelphia, said Compass Working Capital’s past results and ambition for growth won over grant makers. She said that in the program, she sees “potential for really making a significant difference in terms of household economic stability and mobility.”

» READ MORE: Low incomes make Philadelphia homes less affordable, Pew study finds

“We support programs that promote the health and well-being of people with complex challenges that are rooted in poverty,” Romens said. “We know the magnitude of need in the city is great, so we are looking for organizations and programs that have a level of readiness and a vision for helping communities with needs.”

Fair, the self-described “proud homeowner” in North Philadelphia, went through a skilled trades program and became a building manager at the union hall of Philadelphia’s largest union for city workers, District Council 33. Clarifi helped him build credit and guided him through the home-buying process. He received grant money from PHA. His close-knit family came together to support him.

“I had a lot of good people in my corner,” he said.

The Philadelphia Inquirer is one of more than 20 news organizations producing Broke in Philly, a collaborative reporting project on solutions to poverty and the city’s push toward economic justice. See all of our reporting at brokeinphilly.org.