The Chan Zuckerberg Initiative — led by philanthropist Priscilla Chan and her husband, Facebook co-founder Mark Zuckerberg — is investing $5 million in San Francisco startup Landed to help 60 area teachers afford housing, according to the San Francisco Business Times.
- Landed, which has already raised $6.5 million, helps investors finance part of the down payment for a teacher's home. The teacher is then obligated to sell or refinance the property within 30 years, from which the investor gains or absorbs up to 25% of the gain or loss in value, SFGate reported.
While some teachers commute from communities with lower housing costs up to 70 miles away, Landed officials told SFGate that their system enabled one Oakland, CA, elementary school teacher to purchase a property 10 minutes from school.
Teachers in San Francisco aren't the only ones feeling the sting from a lack of affordable housing, though they may be feeling it most acutely. An Apartment List report deemed San Francisco the most unaffordable city for teachers in the U.S., followed by Oakland (No. 6) and San Jose, CA (No. 8).
Sparked by the story of one such teacher's inability to find affordable housing on a $65,000 annual salary, San Francisco recently proposed a $44 million teacher housing project that is expected to include between 130 and 150 units. The project is awaiting final approvals and a developer, but it has a site picked out.
Another San Francisco program has secured $35 million of the $310 million necessary to produce up to 100 new apartments on land owned by the city’s school district. Educators will be able to rent the units at below-market rates, and they will be eligible for rental housing allowances and down payment assistance. Such programs are viewed as tactics to keep teachers from leaving their districts for more affordably priced markets.
A recent Realtor.com report ranked the top college degrees for homeownership based on how long it would take those earning typical starting salaries in those fields to save up for a 20% down payment on a $250,000 home. Early education came in last, with degree-holders needing to work more than eight years in order to save for a down payment.
Down payments are one of the main barriers for those looking to buy a home. Across 20 U.S. markets, 70% of renters surveyed by Zillow earlier this year said they were unable to purchase a home because they couldn’t afford the down payment. The typical 20% down required for a median-priced home can take up more than two-thirds of a buyer’s median annual income. In tight markets like San Francisco, the share can nearly double, pricing out a large percentage of would-be buyers.