Gavin Newsom Backs $11.25 Billion Bond Measure To Boost Home Construction in California

California Gov. Gavin Newsom is urging the state's voters to adopt a proposed $11.25 billion housing affordability bond aimed at boosting residential construction and homeownership rates. 

The governor’s office announced on Monday that Newsom, the state Senate and Assembly have reached a deal to place the Veterans and Affordable Housing Bond Act of 2026 on the ballot in November. 

Described by Newsom's camp as "historic," the proposed ballot measure includes $10 billion in voter-approved general obligation bonds to pay for the construction, rehabilitation, acquisition, and preservation of affordable housing for lower-income Californians, including through down payment assistance and low-interest mortgage financing. 

These bonds would be repaid through state tax revenues over the next 35 years—a fact that raised concern among some Republican legislators.

Assemblymember Buffy Wicks, a Democrat from Oakland, CA, said passing the measure will help get 40,000 already approved and shovel-ready housing units built.

"And when we talk about 40,000 units, we also have to remember that's 40,000 families who need a stable roof over their head," added Wicks.

How the funds will be allocated

The second component of the act includes $1.25 billion in self-supporting revenue bonds for the CalVet Home Loan Program to help veterans and military families purchase homes. 

Unlike the $10 billion in general obligation bonds, the revenue bonds are fully repaid through veteran mortgage payments and do not rely on taxpayer funding. 

The proposed act also designates investments for California's Multifamily Housing Program, as well as for affordable housing and homeownership opportunities for low-income households, seniors, farmworkers, tribal communities, college students, and people experiencing or at risk of homelessness.

Additionally, proponents promise the bond will support tens of thousands of high-paying construction jobs across the state.

"Time and time again, we say that housing affordability and homelessness are top priorities, so it’s incumbent on us to put our money where our mouth is and invest in housing programs that have proven their ability to deliver real results," said Wicks, citing California's 1.2 million affordable housing unit shortage and the 170,000 people currently living on the streets. "What we can’t afford is to wait.” 

Newsom said the ballot-bound proposal is an attempt to tackle California's chronic underbuilding, which has made the state one of the nation's least affordable places to live. Just 17% of households are able to afford to purchase a median-priced single-family home and more than half of renters are classified as cost-burdened in the Golden State.

"California’s future depends on whether people can afford to put down roots, raise a family, and build a life here," said the Democrat.

An F grade and a gubernatorial campaign

The measure arrives at a time when housing affordability and homelessness dominate public discourse in California and shape the gubernatorial campaign, where Democrat Xavier Becerra and Republican Steve Hilton are jockeying to replace the term-limited Newsom.

The depth of the crisis in California goes far beyond political campaigns. In the 2026 Realtor.com® Housing Report Card, the Golden State was among just six states to earn an F grade for homebuilding and housing affordability.

Driven by skyrocketing homeownership costs, California received a startlingly low score of just 21.7 points out of a possible 100.

Realtor.com senior economist Joel Berner says the ballot measure represents a step in the right direction for California, although he notes that it may be too limited in its scope to bring about a total turnaround.

According to Berner, the $10 billion aimed at increasing construction will be well-spent only if it delivers tens of thousands of new housing units. But even then, the economist warns, it will not fundamentally solve the state's massive housing shortage.

"If California really wants to change its F grade, it will address structural limitations to homebuilding like zoning laws and burdensome environmental reviews that prevent private-sector builders from delivering the needed housing in the state," adds Berner.

Legislators are expected to vote on the bond act on Thursday. If it passes both houses and Newsom signs it, the proposal will appear on the ballot in November.