Unlocking Homeownership in California with Social Housing

Written By Michelle Nazzal

Calvin Jordan — Senior Research Fellow

From whatever angle you look at it, California’s housing crisis is grim. More than 187,000 people experience homelessness throughout the state. More than half of renters statewide are housing cost-burdened (defined as spending more than 30 percent of their income on housing expenses), including nearly 27% who are severely cost-burdened (spending more than 50% on housing. Prices have been driven up by the overall lack of housing units, with the California Department of Housing and Community Development estimating that the state needs to produce 2.5 million residences between 2022 and 2030. Californians of all stripes agree that housing is a primary issue impacting the state, with 14% rating it as the most important issue for state lawmakers to address.

In addition to its immediate horrors, California’s housing crunch will have lasting effects on wealth and opportunity for communities throughout the state, especially those of color. Homeownership is a primary means by which individuals in the United States attain long-term financial stability, but purchasing a house in California is especially difficult. The annual household income required to qualify for a mid-tier home in California is $234,000, which is more than twice the median household income. The situation is even worse for the Black and Hispanic Californians who receive lower incomes compared to their white counterparts.

The state’s housing challenges aren’t just about where people sleep — they’re about who gets to build wealth, put down roots, and access the security that homeownership has traditionally provided. As California looks for bold policy solutions, we shouldn’t lose sight of that promise. We have an opportunity to implement new models that preserve the potential for people of all backgrounds to buy a home and build long lives in the Golden State.

Social Housing as a Potential Solution

Policymakers, developers, community organizers, and researchers have debated over the best approaches to increase housing access throughout the state, leading to heightened interest in social housing as a promising option. In Oct. 2023, California Senator Aisha Wahab’s bill was enacted requiring the state to conduct a California Social Housing Study by 2026. In Dec. 2024, the San Francisco Board of Supervisors Budget & Legislative Analyst’s Office produced a detailed policy analysis report examining the financial feasibility of implementing social housing in the city. In April 2025, Assemblymember Alex Lee once again introduced legislation to create statewide social housing (after a similar bill was vetoed by Gov. Gavin Newsom in the 2023–2024 session). 

While there isn’t a universally accepted definition for social housing, the concept generally refers to publicly-funded, nonprofit housing projects designed for both low- and middle-income residents, often managed by some public body that includes tenant input. Properties are taken off the private, speculative real estate market and the land is held to enable long-term affordable housing. The individual benefits of social housing include greater housing affordability and stability for people with modest incomes. Societal benefits come from avoiding geographic concentration of people in poverty and from facilitating socialization between people of different socioeconomic backgrounds.

Potential for Homeownership in Social Housing

While new conversations about the potential for social housing are encouraging, they tend to ignore some important truths about housing in America: Homeownership serves as a key wealth-building tool for low- and middle-income families and it is used by about 65 percent of households (though the homeownership rate is about 10 percent lower in California). These realities underscore the need for any serious social housing plans to include pathways to homeownership. By retaining this core pillar of the American dream in policy development, we can demonstrate that social housing is compatible with the cultural and rational desires people have to own a home and enjoy all of homeownership’s benefits.

This sentiment isn’t idealistic — it’s a rational political consideration in a state where voters are highly skeptical of approving more funding for traditional affordable housing. The failure of Prop. 5 and the decision to not put California’s largest affordable housing bond in front of voters in 2024 demonstrate that policymakers must carefully consider the political perspective when advocating for new housing strategies. It will take significant effort to pass any sort of major social housing legislation, but the endeavor may be made easier by giving taxpayers something they want: an affordable, reliable path to homeownership in the state’s high cost-of-living areas. Social homeownership can satisfy that desire while also helping remedy our critical housing woes. 

Social Homeownership Models

There are a handful of social housing programs around the world that include provisions for residents to buy their homes, with guardrails that prevent exploitation. They offer examples for different policy design choices that could be incorporated into California-based programs providing affordable pathways for low- and middle-income earners to become homeowners:


Singapore

Discussions of social housing almost always include Singapore because its revolutionary 1960s policy decisions and subsequent updates have led to an astounding homeownership rate of roughly 90 percent. Under the Singaporean model of social housing, residents are able to buy government-developed housing units at a subsidized price on a 99-year lease. Homebuyers choose from a range of housing types and enjoy generous financing options, making homeownership attractive and attainable. After living in a property for 5 years or more (10 years for properties in especially high-demand areas), residents are able to sell their homes on the open market and benefit from their financial appreciation.

While this model has led to immense success for Singapore, it is made possible through some key differences with California and the broader U.S. Most notably, the vast majority of land in Singapore is government-owned; this makes it easier for policymakers to act as planners, developers, property managers, and brokers. In addition, single-family detached homes make up a very small percentage of the housing stock in Singapore whereas they comprise the majority of U.S. homes. Although it’s unlikely that the state (or nation) would readily implement a similar housing system given the dominance of the private market, California can still learn valuable lessons from Singapore’s culture of producing high-quality social housing units for residents of all income levels.

Italy

In some respects, the U.S. is more comparable to Italy than Singapore: While Singapore has a decades-long history of public investment in social housing, Italy’s system has suffered from the lack of a unified plan and sustained funding. Homeownership has been supported by policymakers in the U.S. and Italy while social housing models were neglected, leading to high homeowner rates alongside high housing cost burdens in both countries. And both nations have struggled to produce adequate housing supply for their populations, adding to their current housing struggle similarities.

Italy’s government has gradually expanded its social housing system to include pathways to affordable homeownership. Traditionally focused on rental housing, Italy introduced a broader and more flexible framework in 2008 that included lease-to-own agreements in which tenants could rent units with the option to purchase them later. Legislation enacted in 2014 further codified this approach by granting eligible tenants the legal right to purchase their unit after seven years of residency. These programs often credit a portion of monthly rent toward the eventual purchase price, and resale restrictions are imposed to preserve long-term affordability by preventing speculation. A program like this embedded within a social housing framework in California could help address our “missing middle” housing problem by providing long-term, income-sensitive housing with a guaranteed pathway to equity.

France

While France does have a deeply rooted history of social housing throughout the country, its multifaceted approach to social homeownership is also worth consideration. The French social homeownership system includes three programs that help lower- and moderate-income people become homeowners. The first, enacted in 1983, allowed some eligible social housing tenants to buy their affordable rental units after they’ve lived there for more than two years. In the second program, which was implemented in 2004, social housing tenants are able to rent their properties and pay an additional fee that goes entirely toward a down payment if they choose to purchase their property. Most recently, in 2015, a third social homeownership program was authorized wherein the land underlying a property is separated from the building on top of it. Social housing entities retain land ownership and residents have the option to purchase the home on a 99-year lease. 

Each of France’s programs helps reduce the costs of accessing homeownership, and buyers are further supported by an array of financing options, including a zero-interest loan. Across all three programs, resale restrictions, price controls, and income eligibility criteria help ensure that these subsidized homes remain affordable for future buyers and are not lost to market speculation. While France’s social homeownership options are well-funded and may not all be feasible for implementation in California, they offer a broad range of approaches that could be implemented to support long-term homeownership under social housing.

Looking Toward More Accessible Housing

As we wrestle with a vicious housing crisis that affects hundreds of thousands across the state, we all know that Californians don’t need to live this way. Social housing in the U.S. has suffered from a history of neglect (both intentional and otherwise), but its success in other places around the globe shows that different paths are available to us. We can embrace new approaches that prioritize human dignity and economic mobility yet retain aspects of our existing system that people find valuable, like homeownership. 

On the other side of a future with social housing in California lies a world with lasting housing security, fulfilling homeowner opportunities, and equitable economic development. While this represents a significant departure from our current approaches to affordable housing, we can hold on to at least a few popular elements of our housing system to help improve its appeal and long-term viability. As we look toward a future with a growing chorus of voices calling for social housing, we can’t forget that social homeownership is an option too. 

Further Reading

Michelle Nazzal
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