Apple paid $2.5 billion to help out the affordable housing market crisis in California in the growing number of homeless people in the state. The prices in renting out and buying houses are now inflating significantly, making it more difficult to find affordable housing in California. This caused over 30,000 San Francisco residents to move out of the city over the course of April to June and now homeownership in the Bay Area is at a seven-year low.
Apple CEO Tim Cook believes the Silicon Valley and the Bay Area is supposed to be a place for people to live together and call it their home. He explains the emerging issues of the affordable housing crisis in a recent Apple Newsroom article:
“Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home, and we feel a profound civic responsibility to ensure it remains a vibrant place where people can live, have a family and contribute to the community,” said Tim Cook, Apple’s CEO. “Affordable housing means stability and dignity, opportunity and pride. When these things fall out of reach for too many, we know the course we are on is unsustainable, and Apple is committed to being part of the solution.”
In response, Apple created a $2.5 billion plan to help reduce the growth of the homeless population. It is supposed to expedite and encourage more houses to be built and then start the developments in the long term. The funds will also help first-time homebuyers purchase houses, support affordable housing and organizations to reduce the homeless population. Apple has also partnered up with community organizations and California governor Gavin Newsom to provide significant investment for statewide housing support as well.
Next, Apple’s $2.5 billion funding goes as follows. $1 billion goes to the affordable housing investment fund while another $1 billion goes to mortgage assistant funds for first-time homebuyers. Apple also owns over $300 million worth of land for houses to be built there. $150 million is for the Bay Area housing funds and the rest of the $50 million is for the vulnerable populations.
Last, CA governor Gavin Newsom says the $2.5 million plan knows that Apple is serious about the homelessness problem and the company wants to encourage other companies to pitch in their own plans.
“This unparalleled financial commitment to affordable housing and the innovative strategies at the heart of this initiative are proof that Apple is serious about solving this issue. I hope other companies follow their lead,” said Gavin Newsom, governor of California. “The sky-high cost of housing — both for homeowners and renters — is the defining quality-of-life concern for millions of families across this state, one that can only be fixed by building more housing. This partnership with Apple will allow the state of California to do just that.”
Thus, Apple’s $2.5 billion affordable housing plan should take about 2 years to be fully utilized upon future projects. Apple is working with private developers with the right financing and enterprises to start building homes in the Bay Area immediately.