Apple today confirmed a $2.5 billion plan to help address the housing crisis in California.
The company hopes its commitment will accelerate and expand new housing production, jump-start long-term developments, and help first-time buyers purchase new homes.
Almost 30,000 people were forced to leave San Francisco between April and June of this year, while homeownership in the Bay Area is at a seven-year low. That’s thanks to skyrocketing housing costs.
Apple says it is becoming increasingly difficult for teachers, firefighters, service workers, and more to remain in the community they call home. And it wants to change that.
Apple’s fight against the housing crisis
“Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home, and we feel a profound civic responsibility to ensure it remains a vibrant place where people can live, have a family and contribute to the community,” said Apple CEO Tim Cook today.
“Affordable housing means stability and dignity, opportunity and pride. When these things fall out of reach for too many, we know the course we are on is unsustainable, and Apple is committed to being part of the solution.”
Apple is pledging $2.5 billion that will go toward statewide housing support and funding for projects in Silicon Valley and the Bay Area. It is working in partnership with Governor Gavin Newsom, the state of California, and community-based organizations.
Its commitment will be broken down into a number of areas.
How Apple plans to spend $2.5 billion
$1 billion of Apple’s cash will be spent on an affordable housing investment fund. It is said to be a first-of-its-kind fund that will produce the state and others with an open line of credit to develop and build new, very low- to moderate-income housing faster.
Another $1 billion will go into a first-time homebuyer mortgage assistance fund. It will provide aspiring homebuyers with financing and down payment assistant, and increase access for essential service personnel, school employees, and more.
Apple will make land it already owns in San Jose, worth around $300 million, available for affordable housing. It will also spend $150 million on a Bay Area housing fund, and another $50 million on supporting vulnerable populations and reducing homelessness.
“This unparalleled financial commitment to affordable housing, and the innovative strategies at the heart of this initiative, are proof that Apple is serious about solving this issue,” said Newsom.
“The sky-high cost of housing — both for homeowners and renters — is the defining quality-of-life concern for millions of families across this state, one that can only be fixed by building more housing. This partnership with Apple will allow the state of California to do just that.”
‘Committed to being a good neighbor’
In addition to these initiatives, Apple is seeking private developers who, with the right financing and investment, are ready to start construction on affordable housing projects in the Bay Area immediately.
One of the first projects Apple will fund is an expansion to Destination: Home’s Homelessness Prevention System.
“We have worked closely with leading experts to put together a plan that confronts this challenge on all fronts, from the critical need to increase housing supply, to support for first-time homebuyers and young families, to essential philanthropy to assist those at greatest risk,” said Lisa Jackson, Apple’s vice president of Environment, Policy and Social Initiatives.
“Apple is committed to being a good neighbor and helping to write the next chapter of the region that has been a great home of innovation and creativity for generations.”
Apple says it will take approximately two years for its commitment to be full utilized. Capital returned to the company will be reinvested in future projects over the next five years.