Apple Commits $ 2.5 Billion to Relieve California Housing Crunch
On Monday, Apple announced a $ 2.5 billion plan to help solve the California housing crisis, becoming the newest technology giant in the state to solve a problem it helped cause.
The plan includes $ 1 billion for an affordable housing investment fund and an additional $ 1 billion to help first-time buyers find mortgages.
Apple joins other California-based Big Tech companies to ease the state's severe housing crisis. Facebook said last month it would provide $ 1 billion in a package of grants and loans. In June, Google pledged $ 1 billion for a similar effort in California.
Microsoft pledged $ 500 million to affordable housing in Seattle in January.
Apple's plan includes making available plots it owns in San Jose, which it said were worth $ 300 million, for new affordable housing; $ 150 million to support affordable housing in the Bay area, including long-term forgiving loans and grants; and $ 50 million to address the causes of homelessness in Silicon Valley.
The housing supply in the San Francisco area has failed to keep pace as Apple, Google, Facebook and scores of smaller technology-focused companies headquartered in the region have drawn a steady stream of workers. Since 2005, California has added 308 housing units for every 1,000 new residents, according to the McKinsey Global Institute. In the Bay Area, 676,000 jobs have been added over the last eight years, compared to 176,000 additional housing units.
As a result, house prices have risen high beyond the reach of people trying to find a place to live. In June, the national low-income housing coalition said that the Bay Area counties represented five of the six most expensive places to live in the country. In September, California lawmakers responded by approving a state lease that covers millions of tenants.
Homelessness has also increased in some areas of California, causing tent pitches to emerge. San Jose recently reported 6200 homeless people, a 42 percent increase over two years.
"Affordable housing means stability and dignity, opportunity and pride," said Apple CEO Tim Cook in a statement posted on the company's website. "When these things fall out of reach for many, we know that the course we're on is unsustainable, and Apple is committed to being part of the solution."
This is an evolving story and will be updated.