Apr 16, 2024 · 3 min read
CZI Calls for Innovative Financing Approaches To Tackle California’s Housing Shortage
The housing affordability team has launched a request for applications to support funds that are implementing creative approaches to financing the production and preservation of housing in California.
At the Chan Zuckerberg Initiative (CZI), we’re dedicated to rebuilding our housing system so that everyone can live, work, and thrive in California. We believe everyone deserves a safe, stable, accessible and affordable place to call home — and that strong, equitable housing infrastructure is essential and foundational for thriving communities.
These goals are often met with persistent challenges as housing becomes scarcer and increasingly unaffordable. California faces a significant shortage of housing, with state officials estimating we need to build 2.5M new homes — including 40% at below market rate — by 2030. This shortage, along with skyrocketing housing costs, has made it increasingly difficult for many Californians to find affordable living options. Challenges to producing or preserving housing include the high cost of construction and land, barriers to financing newer models of housing, and a lack of sufficient funding for affordable housing.
Innovative financing plays a crucial role in addressing these roadblocks by increasing access to capital, reducing financing costs, and seeding new approaches to housing development. We want to help propel this work forward through investments that scale new approaches to housing finance.
Today, CZI is launching the Innovative Housing Finance Request for Applications (RFA) for funds that finance the production and/or preservation of housing across California. Investments will support funds that finance multiple rental and/or owner-occupied housing projects benefiting low and moderate-income households, and that align with one or more of the following key approaches:
- Lowering the cost to produce or preserve housing (e.g., construction cost reductions, surplus lands projects, streamlined or lower cost financing, insurance coverage and premiums, land banking, etc.).
- Funding housing project types with unique financing barriers (e.g. lot splits, ADUs, development on surplus lands, tenancy in common, cooperatives, etc.) with a focus on taking advantage of recent land use reforms.
- Unlocking or leveraging other sources of funding (e.g. pension funds, climate funds, CRA, hospitals, private sector, tenant vouchers, etc.) through a new approach.
“By investing in funds held by intermediaries, we aim to support the ecosystem of mission-driven lenders and advance financing solutions that scale impact and catalyze meaningful progress toward California’s housing goals,” says Kevin Schuster, CZI’s Senior Manager for Housing Affordability. “We hope that this program helps grow novel approaches to housing finance, share new findings from the field, and build a larger network of values-aligned partners.”
Selected organizations will be considered for funding in 2024 and 2025 through program-related investments (PRIs) that range from $1-3M. Interested organizations are invited to submit a Letter of Inquiry (LOI) before 5 p.m. PT on May 16, 2024. For more information please visit our RFA webpage.
###
About the Chan Zuckerberg Initiative
The Chan Zuckerberg Initiative was founded in 2015 to help solve some of society’s toughest challenges — from eradicating disease and improving education, to addressing the needs of our communities. Through collaboration, providing resources and building technology, our mission is to help build a more inclusive, just and healthy future for everyone. For more information, please visit chanzuckerberg.com.
