There are growing calls to promote fairness for California workers who, due to this state and nation’s history of discrimination, have higher levels of economic and housing insecurity and limited or even non-existent intergenerational wealth.
Special for CalMatters
California Realtors, Habitat for Humanity, and the California Building Industry Association — a housing coalition — echo these calls for leaders on our legislative budget committee working on the state budget review to allocate more of the planned surplus to the construction of owner-occupied housing. and down payment assistance programs.
Increased funding will increase equity in the housing market by expanding opportunities for Californians to obtain housing security while building equity in a home they own.
Many studies show that home ownership is the best way for workers to achieve economic security and build wealth. One cannot support the eradication of disparities in wealth and economic security between groups, especially for communities of color, without also supporting greater access to home ownership.
Assembly members seek $600 million to boost homeownership
The leaders of our state have a unique opportunity to do something about this. Assemblyman Tim Grayson and 27 other Assembly members — Democrats and Republicans — are asking for $600 million to support homeownership in the 2022-23 state budget, including $400 million for the development of restricted housing per deed and $200 million for the state’s existing down payment assistance programs.
If we are serious about giving people the chance to build wealth that will support their families and future generations, we should demand that our government prioritize the development and construction of reasonably priced homes.
Instead of creating a generation of tenants – none of whom will have the opportunity to create the kind of economic security and wealth-building opportunities that older Californians took for granted – we should be giving Californians the opportunity to own and help them build capital that provides financial security and housing stability. Home ownership creates real economic security, in every sense of the word.
Median home price in the state at $787,000
Median home price in California last year was $786,750. This translates to a minimum qualifying annual income of $144,400 and a monthly mortgage payment of $3,610. Such a home is affordable to only 26% of all Californians and only 17% of Latinos and Black Californians. Compared to white/non-Hispanic, the affordability gap is even wider, with affordability levels for black and Latino households being half that of whites.
“Who can call California home?”, a new report sponsored by the California Center for Real Estate, an institute of the California Association of Realtors, and prepared by Dowell Myersa professor at the University of Southern California, finds that “long-term homeowners rack up substantial gains in their home equity, especially in California, with its history of rapid price gains. This in turn promotes the ability of “Mom and Dad’s Bank” to help their children buy a home.The unfortunate consequence of family assistance is that inequality becomes more entrenched between families with differential resources and between members of racial groups who have stronger property inheritances than others.
Assemblyman Grayson and his fellow lawmakers wrote in a formal funding request to the governor earlier this year, saying “homeownership provides working families with an unparalleled ability to accumulate generational wealth and to enjoy housing security, as landlords pay a fixed mortgage instead of continuously rising rent. »
Now is the time for Californians who want the benefits of home ownership to reach out to their state lawmakers and Governor Gavin Newsom and demand action to increase the supply of owned housing.
California real estate agents have the right plan to start bringing equity to the California real estate market. There has never been a more important time to do so.