California allocates over $414 million for new affordable housing developments statewide

Thousands of new affordable homes are set to be built across California following the announcement of more than $414 million in state funding. The California Department of Housing and Community Development is distributing these funds through a streamlined finance program, which will support the development or rehabilitation of 2,099 homes in 16 counties. Of these, 2,068 units are reserved for low- to extremely low-income residents.

Governor Gavin Newsom emphasized the importance of increasing housing supply as part of efforts to address homelessness and affordability issues in the state. “We cannot solve either the homelessness or housing affordability crisis without creating new housing. Today’s announcement will create thousands of new homes for California families, helping hundreds of thousands of people access housing,” said Governor Newsom.

The current initiative builds on measures introduced since 2019 when Governor Newsom made addressing housing and homelessness a statewide priority. In September 2020, he signed legislation aimed at simplifying the state's complex housing finance system by allowing developers to apply for multiple programs with a single application. Since then, this process has allocated $1.622 billion to support nearly 12,700 affordable homes throughout California.

Tomiquia Moss, Secretary of the California Business, Consumer Services and Housing Agency, highlighted how these investments would benefit various groups: “Over $400 million committed to communities across the state will expedite and expand opportunities to build affordable housing and make much-needed infrastructure improvements. These awards will galvanize the collective public-private response to serve low-income households, including seniors, Veterans, large families and residents with special needs, and accelerate climate and health outcomes in neighborhoods across California.”

Gustavo Velasquez, Director of HCD, noted that streamlining financing has allowed more affordable homes to be built: “Governor Newsom’s creation of the Multifamily Finance Super NOFA was a major step in streamlining a complex housing finance system to reduce costs and allow more affordable homes to be built. His creation of the California Housing and Homelessness Agency will give us the tools to build on this and other Department successes in addressing housing availability and affordability at scale—tackling a crisis decades in the making and strengthening communities throughout California.”

The breakdown of today’s awards includes $244.1 million from MultiFamily Housing program funds supporting ten projects with 769 assisted units; $128.9 million from Farmworker Housing Grant program funds for ten projects with 345 units; $28.5 million from Infill Infrastructure Grant Program awards supporting development of 553 units (including those reserved for seniors, large families, permanent supportive housing or residents with special needs); and $12.7 million from Veterans Housing and Homelessness Prevention Program funds creating 87 homes for veterans.

These allocations follow recent commitments such as an additional $106.2 million under Proposition 1 funding aimed at developing supportive Homekey+ units for veterans and individuals facing behavioral health challenges.

Since taking office, Governor Newsom's administration has pursued reforms targeting mental health care gaps linked with homelessness—including expanding treatment centers funded by voter-approved bonds—and updating conservatorship laws along with launching CARE courts designed for individuals struggling with untreated mental illness or substance use disorders.

Efforts have also included legislative reforms intended to streamline construction processes by removing barriers like certain environmental regulations (CEQA), providing local governments both funding support and accountability requirements related to shelter provision—and setting expectations around clearing encampments while connecting affected individuals with services.

Recent data indicate that while national rates of homelessness increased significantly in 2024—with an over-18% rise—California managed an increase limited to just three percent overall according to federal reports (https://www.huduser.gov/portal/sites/default/files/pdf/2023-AHAR-Part-1.pdf). The state also saw only minimal growth in unsheltered homelessness compared with national trends (less than half a percent versus nearly seven percent nationwide) (https://www.hudexchange.info/news/hud-releases-2023-ahar-part-1-pit-estimates-of-homelessness-in-the-us/). Furthermore, reductions were achieved among veteran homeless populations as well as youth experiencing homelessness.