When it rolled out last year, the California Dream for All program — a loan application for first-time home buyers — exhausted its approximately $300 million of funding within 11 days.
That prompted some changes this year for when the down payment assistance program opened again to California residents on April 3. The state has about $250 million on the table, which is expected to assist between 1,600–2,000 new applicants, said Eric Johnson, a spokesperson for the California Housing Finance Agency (CalHFA).
The program — officially called the California Dream for All Shared Appreciation Loan — is designed to have the state step into the role of a parent or grandparent in assisting their offspring buy a home.
“The program is designed to help those who may not have had the benefit of generational wealth in buying their first home,” Johnson said.
If you’re hoping to apply for the California Dream for All program in 2024, keep reading to see who is eligible, how the program has changed this year, and what you need to do. But hurry: Applications for the program officially close at 5 p.m. Pacific Time on Monday, April 29.
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Who got the money in 2023?
While wildly popular, the California Dream for All program didn’t have the geographic reach its designers had hoped for — nor did it reach its intended demographic target, said Adam Briones, the CEO of California Community Builders, a nonprofit housing research and advocacy organization.
Briones and his team did the research that helped design the program to close the racial homeownership gap in the state. In California, nearly 37% of Black households own their homes compared to 63% of white households, according to the Public Policy Institute of California.
“The original hope of the program had been that formerly redlined communities, low-wealth communities … [would] be disproportionately supported by this program,” Briones said, “because they’ve been disproportionately held back by inequalities, both in terms of public policy and the way that our economic system works.”
“And we didn’t see that.”
The first round of California Dream For All funding helped nearly 2,200 new homeowners purchase homes. But of those, only 3% of the grantees were Black, according to CalHFA. That’s compared to 35% of white recipients, 33% Latino and 19% Asian American and Pacific Islander.
Nor were the California Dream for All funds distributed equally on a geographic basis, Briones said. A disproportionate share went to Sacramento residents, he said.
“A lot of that had to do with informal knowledge access and understanding of a large program that was going to be rolled out,” Briones said. But he cautioned, “If Californians throughout the state don’t benefit from the program, it’s going to be really hard to make the argument to voters that they should continue investing in these types of things.”
This time around, changes to the 2024 California Dream for All program are meant to address those disparities, Johnson said. Here’s what you need to know to apply.
What is the California Dream For All program, and how does it work?
Under the California Dream For All program, the state will put down up to 20% of the cost of the home, or up to $150,000.
That money does have to be repaid, just not right away. It gets repaid — without interest — when you sell the home.
However, there’s a catch. You also have to pay back 20% of any appreciation on the home’s value (which is why the program is called a Shared Appreciation Loan). So, if you buy a $600,000 home and then sell it 10 years later for $700,000, you would have to pay back the initial $120,000 down payment, along with an additional $20,000.