This Program Helps Californians Buy Affordable Homes. Advocates Want More Funding

Andie Rounds’ Novato home is blue, two stories, with white trim around the windows and doors. In the backyard, her son grows summer vegetables.

But her favorite part might be the small balcony off the master bedroom, where she can people-watch and look out over a nearby hill. “And I love sitting on it — especially when it’s a little colder, and I’ll sit there with my cup of coffee.”

This home, now a source of comforts both big and small, was very nearly not hers. In 2016, she won a literal lottery for the chance to purchase it at an affordable price, an opportunity made possible by Habitat for Humanity’s Greater San Francisco chapter with help from a state grant program called CalHome.

As homeownership remains out of reach for many — with just 17% of Californians able to afford a typical single-family home — CalHome is an outlier. It offers rare state funding for the construction of affordable homes to buy, rather than rent, and supports first-time homebuyer and home repair programs.

In 2024, the state allocated around $170 million to CalHome and a farmworker housing program, and on Monday issued the grants, which will benefit nearly 1,200 households in 22 counties.

But funding was cut from the current state budget, and advocates are urging it be replenished with as much as $500 million in the coming fiscal year.

“This is not money that’s going to go into a black hole,” said Maureen Sedonaen, CEO of Habitat Greater San Francisco. “This is people’s lives you’re going to see that get transformed.”

Rounds had been renting an apartment in Novato in 2016, when her property manager told her the company wouldn’t renew her lease.

It felt as though the rug was getting pulled out from under her. A night nurse and single mom with three kids — a toddler and two girls in middle school — she was worried her family could be forced to leave with little notice.

“I was mad,” Rounds said. “It was that feeling of insecurity and, ‘Oh my goodness, what’s going to happen to my family?’ You know, what do I do?”

She learned about Habitat’s lottery about a month later, while scrolling on Facebook. It was the day before applications were due. She rushed to submit hers with mere hours to spare.

Then, on the day of the drawing, her number came up.

“I just burst out crying. I mean, going from a feeling of insecurity and instability to like, ‘Oh my gosh, I’m gonna be able to provide stability for my children,’” Rounds recalled. “That feeling — every parent deserves to have that feeling.”

Rounds was vying for one of just 10 spots. Sedonaen said Habitat lotteries are typically vastly oversubscribed, with hundreds of applicants for very few homes.

“My colleagues are seeing this all throughout the state,” Sedonaen said, referring to Habitat’s 33 chapters statewide, “because so many people are looking for permanent affordable housing and the opportunity to become a first-time homeowner.”

Habitat’s program isn’t a give-away, Sedonaen said. Participants have to complete more than 100 hours of training in financial literacy and home maintenance. And, they actually help build their homes — what Habitat calls sweat equity.

“We’re not Oprah,” she said. “It’s not like, ‘You get a house, and you get a house!’”

Habitat’s San Francisco chapter doesn’t require homeowners to put any money down and offers a no-interest loan for the mortgage. Payments are structured so owners pay no more than a third of their income on total expenses.

State funding from CalHome subsidizes about 30% of the total cost, Sedonaen said. But with this year’s funding cut, she said some 500 homes statewide that Habitat has queued for construction won’t be able to move forward.

And there aren’t many other state programs that support that kind of work, said Sosan Madanat, a lobbyist with W Strategies LLC. Besides CalHome, only the Joe Serna Jr. Farmworker Housing Grant provides funding for the construction of affordable, for-sale housing, according to the California Department of Housing and Community Development.

“That is why it has been so detrimental to organizations like Habitat that build affordable homeownership projects,” Madanat said. “It’s the funding they rely on.”

There are other homebuyer assistance programs — such as the California Dream for All program, which offers shared equity down payments. But Madanat said that while it helps on the demand side, allowing prospective homebuyers to better compete on the private market, it doesn’t help with the supply side, ensuring there are enough affordable homes available to purchase.

With a projected $18 billion state budget deficit looming in the upcoming fiscal year, along with expected federal funding cuts to myriad social services, it’s unclear whether California will allocate more money to the program in the coming year.

“Funding is probably one of the biggest things that we could do to make it easier for folks like Habitat to build. But given the current financial outlook of the state, it’s much more challenging to do that,” Madanat said.

There is evidence that the ability to purchase an affordable home leads to better outcomes for kids, particularly in educational attainment, school attendance and health.

Rounds said having predictable monthly payments allowed her to focus on her career and even publish a book. When she was diagnosed with breast cancer two years after moving in, her home was a source of stability during her recovery, she said. “Every morning I would wake up, open my eyes, look up and be grateful.”

Rounds gets emotional when she talks about her two daughters. Being able to save money meant she could afford to send them to college. When it came time to move them into dorms, she was able to buy furnishings and get them settled in.

“And the pride in it,” Rounds said. “I have no words really.”

They graduated this year.

“And, that’s huge,” she said, “to be able to say that was all possible because of our home and the stability it provided.”