There are 46,605 affordable homes in the near-construction pipeline awaiting funding in California, according to a new study by Enterprise Community Partners.

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These units are in developments that are awaiting final funding to complete their total financing need and break ground. They’ve applied for and/or secured state or federal funding but still require additional dollars to begin construction.

Over half of these homes, nearly 26,000 units, have been awarded funding from at least one state program.

“California is a stark illustration of the greater affordable housing crisis in the United States. It’s absolutely critical that we address the funding needs to unlock this development pipeline and to advance solutions,” said Heather Hood, vice president and Northern California market leader at Enterprise Community Partners. “Our research shows that there are significant numbers of homes ready and waiting to be built in California communities for families struggling to find a safe, stable, affordable home if only funding were to be made available. The development of new affordable homes is a critical response to combat the housing crisis and rising homelessness, and we urge local, regional, state, and federal leaders to prioritize resources to prevent further delays.”

The affordable developments identified in the pipeline would benefit an estimated 512,655 households over the next 55 years, according to the report, which notes the state needs to produce 1 million affordable homes over the next decade.

The research found that to move the developments forward these communities need an estimated $2.6 billion in state subsidies and $978 million in state tax credits. On average, the state contributes $148,120 in subsidies to each affordable home it funds. For every $1 of state funds invested in developments, $4 of private and federal funds are leveraged.

The report offers four main recommendations:

1. Invest in ongoing state funding:

Enterprise highlights maintaining affordable housing program funding in this year’s state budget as well as passing a state affordable housing bond, as proposed in Assembly Bill 1657, to support the affordable housing pipeline;

According to the California Housing Partnership, the bond would lead to the creation of 28,495 new homes for low-income families; 93,195 affordable homes preserved, rehabilitated, or retrofitted; and 13,232 new homeownership opportunities for Californians; and

Enterprise concludes that a permanent and consistent source of investment for affordable housing is needed to meet the state’s needs.

2. Curb costs by addressing system inefficiencies:

Enterprise says California can reduce development costs by better coordinating its housing finance system, including having a single, unified funding application as well as a waitlist and off-ramp for federal resources. The current system requires developments to apply to multiple state housing finance agencies to access subsidies, bonds, and tax credits. This leads to many inefficiencies, adds additional costs, and further delays the development of needed affordable homes.

3. Empower local and regional jurisdictions to do their part:

Enterprise sees a significant opportunity in Assembly Constitutional Amendment 1, which would amend the local bond measures threshold and effectively unlock opportunities to pass local affordable housing bonds.

4. Reform federal programs:

Enterprise recognizes the need for federal investments and reform to scale affordable housing solutions and emphasizes the opportunities available through the Tax Relief for American Families and Workers Act of 2024 (H.R. 7024), which effectively expands the low-income housing tax credit (LIHTC); and

The organization estimates that, if these reforms were enacted, it would lower the pipeline’s need for tax-exempt bonds from $8.2 billion to $4.9 billion. In practice, this would dramatically increase access to federal 4% LIHTCs in California, which is available on as-needed basis to qualifying developments with tax-exempt bonds.