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Apple wants affordable housing in California – but laws stand in the way



  Huge, circular complex surrounded by suburban areas.
Enlarge / The Apple Park campus stands in this aerial photo taken of Cupertino in October 2019.

Apple pledged $ 2.5 billion to help address California's affordable housing crisis, announced the company 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 that build homes for low-income people.

An additional $ 1 billion will be used to help first-time home buyers – especially "essential service personnel, school employees, and veterans." In communities like Cupertino, where Apple is based, police and teachers often struggle to afford housing near their jobs.

Apple says it will also provide land worth $ 300 million in San Jose for a project to build thousands of new affordable housing units. Another $ 150 million will go toward supporting various affordable housing projects in Silicon Valley, while a final $ 50 million is earmarked for a nonprofit focused on homelessness in Silicon Valley.

Apple's commitment follows the heels of similar announcements from other tech giants:

  • In January, Microsoft said it would provide $ 500 million dollars in grants and loans to promote affordable housing in the Seattle area and help homeless people.
  • 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 provide $ 1 billion in grants and loans to support the construction of 20,000 residential units in the region.

Apple's initiative is larger than the other programs and appears to be more focused on low-income housing.

wages cannot solve California's housing problem

These attempts to promote affordable housing are praiseworthy, but the company's initiative alone is unlikely to solve California's housing crisis. Golden State's basic housing problem is that state and local laws simply do not allow developers to build enough housing to meet growing demand.

In the 1900s, cities were able to meet the growing demand for housing by pushing the suburbs outward. But in large metropolitan areas such as San Francisco and Los Angeles, that process has largely begun. Most of the country within reasonable driving distance from job centers has been developed. Which means that the only way to accommodate further growth is by increasing density: replacing detached houses with two-sided, terraced houses and apartment buildings.

The problem is that the law does not allow this in most areas. A Los Angeles Times analysis found that 62% of Los Angeles countries are only zoned for single-family homes. In San Francisco, 75% of the country is regulated so as not to allow anything closer than a duplex. Laws in suburban Silicon Valley are even stricter.

At the same time, the technology boom has put more and more money into the hands of residents associated with the technology sector. So more and more dollars are chasing housing, while housing supply has hardly increased year on year.

The Apple, Google and Facebook initiatives aim to solve this by either subsidizing the development of specific housing projects or by helping to lower – Incoming homeowners can afford the inflated housing costs. These are worthwhile initiatives, but there is only so much they can achieve while the overall supply of housing is so strictly limited.

If Apple gives some low-income families financial help to buy a home, it will help those homeowners. But there is a risk that this simply means that other families with similar incomes – but without the help of Apple – are priced out of the market.

Legislation to liberalize housing regulations was put forward

Ultimately, the only way to make housing affordable is to build much more of it. And it will not happen without changes to the law.

This year, Secretary of State Scott Wiener, a Democrat who represents part of San Francisco, sought lawsuits to revise the state's regulatory rules. His bill would loosen housing regulations near bus stops, metro stations and many jobs, and provide opportunities for the construction of several blocks of flats nearby. A boom in a high-density building can alleviate the state's severe housing shortage and curb the seemingly inexorable rise in housing costs.

gentrification and from neighborhood activists who simply do not want housing blocks built near the detached house. Opponents managed to get the bill cleared in May. It will come to treatment next year.


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