Apple has pledged $2.5 billion to help address California's affordable-housing crisis, the company announced on Monday. In recent years, the San Francisco Bay Area has become the most expensive housing market in America. Los Angeles also suffers from housing costs far above the national average.
Apple's $2.5 billion package includes several different initiatives. Apple will offer a $1 billion line of credit to organizations building housing for low-income people.
Another $1 billion will be used to help first-time homebuyers—especially "essential service personnel, school employees, and veterans." In communities like Cupertino, where Apple is based, cops and schoolteachers often struggle to afford housing near their jobs.
Apple says it will also donate land worth $300 million in San Jose for a project to build thousands of new affordable housing units. Another $150 million will go to support various affordable housing projects in Silicon Valley, while a final $50 million is earmarked for a nonprofit that focuses on homelessness in Silicon Valley.
Apple's commitment follows on the heels of similar announcements by other technology giants:
- In January, Microsoft said it would provide $500 million in grants and loans to promote affordable housing in the Seattle area and aid the homeless.
- In June, Google announced a $1 billion initiative, including $750 million worth of Google-owned land, to support the development of at least 20,000 new housing units "at all income levels" in the San Francisco Bay Area.
- In October, Facebook unveiled its own initiative to offer $1 billion in grants and loans to support the construction of 20,000 housing units in the region.
Apple's initiative is larger than the other programs and appears to be more focused on low-income housing.
Corporate initiatives alone cant fix Californias housing problem
These efforts to promote affordable housing are laudable, but corporate initiatives alone are unlikely to solve California's housing crisis. The Golden State's fundamental housing problem is that state and local laws simply don't allow developers to build enough housing to accommodate rising demand.
In the 20th century, cities could accommodate growing demand for housing by pushing suburbs outwards. But in major metropolitan areas like San Francisco and Los Angeles, that process has largely run its course. Most of the land within a reasonable driving distance of job centers has been developed. Which means that the only way to accommodate further growth is by increasing density: replacing single-family homes with duplexes, townhouses, and apartment buildings.
The problem is that the law doesn't allow this in most areas. A Los Angeles Times analysis found that 62% of land in Los Angeles is zoned for single-family homes only. In San Francisco, 75% of the land is zoned not to allow anything denser than a duplex. Laws in suburban Silicon Valley are even stricter.
At the same time, the technology boom has put more and more money in the hands of residents associated with the technology sector. So more and more dollars are chasing housing, while the supply of housing has barely increased from year to year.
The Apple, Google, and Facebook initiatives aim to address this by either subsidizing the development of specific housing projects or byRead More – Source