Dream for All must be fully funded
California is experiencing a tremendous housing crisis. A combination of too few homes and condos on the market and continued strong demand for homeownership has caused housing prices around the state and here in Ventura County to skyrocket. That, in turn, has created an often-insurmountable obstacle for families looking to achieve the American dream of homeownership — saving up for a down payment.
A new state program launched this spring has proven to be an effective way to help more Californians achieve homeownership. The California Dream for All down payment assistance program loans first-time buyers 20% of the purchase price of a home to pay for the down payment. That money will be repaid when the buyer sells or refinances the home, along with a share of the home’s appreciated value.
2023 VCCAR President
To say the program has been successful is an understatement. Three hundred million dollars were made available when the program launched, and all of it was reserved in just 11 days. To help more first-time buyers become homeowners and help close the wealth gap between homeowners and long-term renters, the program needs to be expanded.
That’s why the Ventura County Coastal Association of REALTORS® strongly supports a plan by state Senate President Pro Tem Toni Atkins, D-San Diego, to release the remaining $200 million allocated in last year’s budget and to add an additional $800 million in the 2023-24 state budget, bringing the total funding to $1 billion. Because the Legislature must pass a budget by June 15, there’s no time to lose. Please let your senator and Assemblymember know today that you support this innovative and ultimately self-sustaining program.
How serious is the housing crisis? The California Association of REALTORS® reports that the statewide median home price is now $815,340. Only about 20% of Californians overall and just 12% of Black and Latino households can afford to buy that median-priced home today.
The crisis in Ventura County, where the median price is now $885,500, is even worse. Because so many homeowners bought or refinanced their homes while interest rates were in the 3% range, few are interested in selling even if it makes sense to downsize. That lack of homes for sale is likely to continue for several years.
This crisis especially affects first-time buyers who don’t have equity they can tap to cover the down payment. A prospective buyer would need to save $26,565 for the minimum 3% down payment. For a traditional 20% down payment, they would need a staggering $177,100.
No wonder that statewide, first-time buyers made up just 26% of all homebuyers last year, down from 34% the year before. And of those first-time buyers, 22% received help through a gift or loan from a family member or friend.
Policymakers must develop innovative new programs to help ease the crisis, and the California Dream for All program is a great example of what can be done. Homeownership should be an achievable goal for working Californians, not just for the select few. And creating more homeownership opportunities will help close the wealth gap for communities of color, many of whom are first-generation homeowners. Homeownership is perhaps the most important way for a family to build wealth that can, in turn, be used to help the next generation. We must find ways to bridge the gap between the haves and the have-nots in the housing market — those who have access to intergenerational wealth and those who are being left behind and out of homeownership.
The California Dream for All program is not a panacea, but it is an important first step. The time is now to fully fund the program in this year’s state budget.
Juliet Esquibias is the 2023 President of the Ventura County Coastal Association of REALTORS®.