Oregon Democratic Sens. Jeff Merkley and Ron Wyden introduced the Homeownership Promise Act Wednesday, a proposal that would have the federal government match first-time homebuyers' savings at a rate of $5 for every $1 saved. Federal matching funds would be capped at $50,000, according to Merkley's office and Axios.

Under the proposal, a buyer who saves $4,000 for a down payment could receive a $20,000 federal match. The program would not impose an income limit, but eligible buyers would have to purchase a principal residence priced at or below the median home price in their area. The maximum combined amount available would be $60,000, including up to $10,000 in personal, employer or nonprofit contributions and the $50,000 federal match.

Participants would save through financial institutions certified by the Treasury Department as Community Development Financial Institutions, including community development banks and credit unions serving underserved communities. Employers and nonprofit organizations could contribute to an account, although those contributions would not receive a federal match.

Merkley said the legislation is intended to make it easier for Americans to accumulate enough money for a down payment as homeownership becomes more difficult for first-time buyers. The proposal comes as elevated mortgage rates and high home prices continue to weigh on housing affordability.

Congress passed a bipartisan housing package earlier this year that focused largely on encouraging additional home construction and included no new federal spending. Merkley's proposal takes a different approach by directing federal money toward individual buyers who save for a home.

The proposal resembles federal assistance offered during the financial crisis, when Congress created a first-time homebuyer tax credit that was later expanded to as much as $8,000. Supporters of the new plan argue that matching savings could help buyers overcome the down-payment barrier, while critics cited by Axios have warned that adding purchasing power without increasing housing supply could increase competition and put additional upward pressure on home prices.