The Connecticut Housing Finance Authority's $123 million sale of tax-exempt bonds was oversubscribed and generated more than $400 million in orders on one day, authority officials said.
Ratings of AAA and Aaa from Standard & Poor's and Moody's Investors Service combined with strong local demand drove down interest rates, CHFA said in a statement.
JPMorgan was lead senior manager.
The authority, which plans to use proceeds to finance its single-family mortgage program, said $104 million of the Aug. 4 transaction came from retail and institutional investors within the state.
"We expect the proceeds from this bond sale to finance nearly 700 mortgages for first-time homebuyers in Connecticut," said Eric Chatman, CHFA president and executive director. "Bringing first-time buyers into the housing market is essential to keeping the housing recovery going."
The current below-market interest rates on CHFA mortgages for first-time homebuyers ranges from 3.25% to 3.6%. CHFA said it financed $152 million in mortgages in the first six months of 2014. Since its founding in 1969, the authority has financed more than 130,000 mortgages for first-time homebuyers.
Rocky Hill-based CHFA sold the 2024 bonds, for example, at a spread of 68 basis points over the Municipal Market Data benchmark, or 2.95%. The Aug. 4 offering was CHFA's third bond issue in 2014. Previous issuances funded single-family mortgages and the development of affordable multifamily rental housing.
