David Reid House Bill 183 Expands First-Time Home Buyer Savings Plan

Sep 9, 2026, 7:30 AM ET

RICHMOND, Va. — The Virginia House of Delegates has overwhelmingly approved House Bill 183, a measure designed to enhance the state’s First-Time Home Buyer Savings Plan by expanding eligible properties and doubling contribution limits, signaling strong legislative momentum toward bolstering individual pathways to homeownership.

Introduced by Delegate David Reid on January 14, 2026, after being prefiled on January 7, HB183 swiftly advanced through the legislative process. Referred to the House Appropriations Committee, it received a favorable recommendation from the Commerce, Agriculture, and Natural Resources subcommittee on January 21. The full committee reported it with a substitute on January 28, passing 16-5. The House then agreed to the substitute, read the bill three times, and passed it on February 3 by a resounding 96-2 vote, reflecting broad consensus on the need to incentivize personal savings for home purchases.

The legislation amends Sections 36-171 and 36-173 of the Code of Virginia, which govern the First-Time Home Buyer Savings Plan Act. Established to promote homeownership, the act allows individuals to designate savings accounts at financial institutions as tax-exempt for interest and income earned, provided the funds are used for down payments and allowable closing costs on a single-family residence in Virginia. Account holders claim this status on their state income tax returns, with financial institutions bearing no responsibility for verification or tracking.

Key provisions of HB183 include explicitly adding townhouses to the definition of ‘single-family residence,’ which already encompasses manufactured homes, condominiums, and cooperatives. This change broadens access to denser housing options prevalent in urban and suburban areas. The bill also defines ‘first-time homebuyer’ as someone who has not owned a principal residence in the prior three years, or who previously co-owned with a spouse but is now purchasing independently. Crucially, it doubles the aggregate principal contribution limit per account from $50,000 to $100,000 and raises the cap on principal plus earnings from $150,000 to $200,000.

These adjustments address escalating housing costs, particularly in regions like Northern Virginia, where median home prices have strained young families and workers. By enhancing tax-deferred savings capacity, the plan empowers savers to accumulate larger down payments without relying on government subsidies, aligning with principles of fiscal responsibility and self-reliance. The near-unanimous House passage, including robust support from the Appropriations Committee, underscores recognition that such incentives foster wealth-building and community stability through private initiative.

Fiscal impact statements from the Department of Taxation, issued January 17 and February 17, project a minimal unknown negative revenue effect on the General Fund starting in fiscal year 2027. No additional administrative funding is required, as implementation involves routine processes without major system overhauls. The bill’s effective date would be July 1, 2026, if enacted.

Following House passage, HB183 crossed over to the Senate, where it was referred to the Finance and Appropriations Committee. On February 25, the committee voted unanimously 15-0 to continue the bill to the 2027 session, allowing further review amid end-of-session priorities. This deferral provides an opportunity for refined analysis of long-term economic benefits, such as increased property tax bases from higher homeownership rates and reduced turnover in rental markets.

Proponents highlight the plan’s market-driven approach, shielding earnings from Virginia taxable income while limiting exemptions to targeted uses. Only cash and marketable securities qualify as principal contributions, ensuring disciplined saving. Upon an account holder’s death, funds distribute per financial institution contracts, maintaining flexibility.

The First-Time Home Buyer Savings Plan, dormant in recent years, gains renewed relevance with HB183’s modernization. By including townhouses and elevating limits, it accommodates contemporary housing stock and inflation-adjusted needs, helping Virginians secure principal residences that anchor families and neighborhoods. Qualified beneficiaries must reside in the Commonwealth at settlement and apply funds solely to eligible costs, reinforcing the program’s focus on in-state economic contributions.

As the General Assembly adjourns its 2026 regular session, HB183’s trajectory exemplifies targeted tax policy favoring personal financial independence. Lawmakers backing the expansion view it as a prudent step to sustain Virginia’s housing market vitality, promoting the enduring value of homeownership as a cornerstone of prosperity and stability. With carryover to 2027, stakeholders anticipate continued advocacy for its passage, potentially shaping the next session’s housing agenda.

Email the Richmond City Council:
Andrew Breton, andrew.breton@rva.gov,
Katherine Jordan, katherine.jordan@rva.gov,
Kenya Gibson, kenya.gibson@rva.gov,
Sarah Abubaker, sarah.abubaker@rva.gov,
Stephanie Lynch, stephanie.lynch@rva.gov,
Ellen Robertson, ellen.robertson@rva.gov,
Cynthia Newbille, cynthia.newbille@rva.gov,
Reva Trammell, reva.trammell@rva.gov,
Nicole Jones, nicole.jones@rva.gov,

Email the Richmond School Board:
Matthew Percival, mpercival@rvaschools.net,
Kathryn Ricard, kricard@rvaschools.net,
Ali Faruk, afaruk@rvaschools.net,
Wesley Hedgepeth, whedgepeth@rvaschools.net,
Stephanie Rizzi, srizzi@rvaschools.net,
Anne Holton, aholton@rvaschools.net,
Cheryl Burke, cburke2@rvaschools.net,
Emmett Jafari, ejafari@rvaschools.net,
Shavonda Fernandez, sdixon@rvaschools.net,

Richmond Virginia House of Delegates Virginia Senate Aaron Rouse Abigail Spanberger Adam Ebbin Adele McClure Agriculture Alex Askew Alfonso Lopez Ali Faruk Amy Laufer Andrew Breton Angelia Williams Graves Anne Holton Anne Tata Atoosa Reaser Barbara Favola Barry Knight Betsy Carr Bill DeSteph Bill Wiley Bonita Anthony Briana Sewell Bryce Reeves Buddy Fowler Charlie Schmidt Charniele Herring Cheryl Burke Chris Runion Christie Craig Christopher Head Cia Price Cliff Hayes Creigh Deeds Cynthia Newbille Dan Helmer Danica Roem Danny Diggs David Marsden David Reid David Suetterlein Debra Gardner Delores McQuinn Delores Oates Destiny LeVere Bolling Don Scott Elizabeth Bennett-Parker Elizabeth Guzmán Ellen McLaughlin Ellen Robertson Emily Jordan Emmett Jafari Eric Phillips Eric Zehr Families Garrett McGuire Glen Sturtevant Gretchen Bulova Hillary Kent Holly Seibold House of Delegates Housing inflation Irene Shin Israel O'Quinn Jackie Glass Jas Jeet Singh Jason Ballard Jay Leftwich Jeion Ward Jennifer Boysko Jennifer Carroll Foy Jeremy McPike Jessica Anderson John McAuliff Joseph McNamara Josh Thomas Joshua Cole Justin Pence Kacey Carnegie Kannan Srinivasan Karen Hamilton Karen Keys-Gamarra Karrie Delaney Katherine Jordan Kathryn Ricard Kathy Tran Katrina Callsen Keith Hodges Kelly Convirs-Fowler Kenya Gibson Kimberly Pope Adams Lamont Bagby Lashrecse Aird Laura Cohen Lawmakers Lee Ware Legislation Leslie Mehta Lily Franklin Lindsey Dougherty Louise Lucas Luke Torian Luther Cifers Madison Whittle Mamie Locke Marcus Simon Margaret Franklin Mark Downey Mark Obenshain Mark Peake Marty Martinez Matthew Percival May Nivar Michael Feggans Michael Jones Michael Webert Michelle Maldonado Mike Cherry Mitchell Cornett Nadarius Clark Nicole Cole Nicole Jones Northern Virginia Otto Wachsmann Patrick Hope Paul Krizek Phil Hernandez Phillip Scott Policy Rae Cousins Reva Trammell Richard Stuart Richmond Richmond City Council Richmond School Board Rip Sullivan Robert Bloxom Rodney Willett Rozia Henson Russet Perry Ryan McDougle Saddam Salim Sam Rasoul Sarah Abubaker Schuyler VanValkenburg Scott Surovell Scott Wyatt Senate Shavonda Fernandez Shelly Simonds Stacey Carroll Stella Pekarsky Stephanie Lynch Stephanie Rizzi Tammy Mulchi Tara Durant Terry Austin Terry Kilgore Tim Griffin Timmy French Todd Pillion Tom Garrett Tommy Wright Tony Wilt Travis Hackworth Virgil Thornton Virginia Virginia House Virginia House of Delegates Virginia Senate Vivian Watts Wendell Walker Wesley Hedgepeth Will Davis Will Morefield William Stanley Wren Williams