SACRAMENTO, CA — California voters are being asked to weigh Proposition 37, a measure that would create a $25 billion loan program aimed at helping residents afford the upfront cash needed to buy a home. The proposal would let the state issue revenue bonds to support the program, with the loans covering up to 17% of a buyer’s down payment. Buyers would still need to bring at least 3% of their own money to the deal.
Backers say the idea is meant to make homeownership more reachable for households that can handle a mortgage but struggle to save enough cash to get started. Former state Senate Majority Leader and former Assembly Speaker Bob Hertzberg authored the measure. In a television interview with KCRA, Hertzberg said homeownership can build long-term wealth because owners pay down a mortgage while the property can gain value over time.
How The Program Would Work
Under the proposal, the primary mortgage would cover the remaining 80% of the purchase price. The down payment assistance would be available only for new homes bought from builders that meet the measure’s standards. The Legislative Analyst’s Office has said the program would not cost taxpayers because it would be financed through private investment rather than general tax dollars.
That distinction matters because the measure calls for revenue bonds, not general obligation bonds. According to the analyst’s office, revenue bonds are repaid through the program structure itself instead of putting taxpayers directly on the hook. Hertzberg made that point as well, saying private investors would provide the money for the assistance and that the plan would not rely on taxpayer dollars.
Who Could Qualify
Prop. 37 sets several eligibility rules. A borrower would need to have lived in California for more than a year, live in the home they buy, and earn less than 200% of the area median income. The measure would also limit the loans to people who can contribute their own cash toward the purchase, rather than fully financing the down payment through the state-backed program.
KCRA noted some examples from the proposal’s framing. In Sacramento County, a buyer could purchase an average home after saving about $16,000 for the required 3% contribution. In San Francisco, the amount would be about $42,000. For a family of four in Los Angeles County, the income cap would be $203,000 a year, while in San Francisco County it would be $342,000.
Support, Opposition And Next Steps
Proponents say the measure is designed to help renters move into ownership and add to the supply of homes aimed at the middle class. They also say homeowners would keep all profit from a future sale, unlike some existing down payment programs that share appreciation with the state. Other state assistance programs exist now, but KCRA reported that they generally are limited to first-time buyers and do not require repayment alongside the main mortgage in the same way Prop. 37 would.
There is no formal opposition filed with the secretary of state, and that will be reflected in the official voters’ guide. Still, Assemblyman Carl DeMaio has publicly opposed the measure, arguing that some borrowers may not be able to afford the loans and that the proposal could add construction mandates that raise building costs. Voters can review the official voters’ guide and the measure text for the full eligibility rules and structure.
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