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On November 3, 2026, California voters will decide two statewide housing measures: Proposition 1 and Proposition 37. Both aim to expand housing options, but they work differently. Here is a plain, neutral look at what each one does, based on the official Legislative Analyst and Secretary of State summaries, so South Bay buyers and homeowners can follow the debate.
Proposition 37: Middle-Class Homeownership Loans
Proposition 37 would let the California Housing Finance Agency (CalHFA) sell up to $25 billion in revenue bonds to fund a new “middle-class homeownership loan.” Each loan could cover up to 17% of the purchase price of a newly built home. Buyers would still put down at least 3% of their own money. Homeowners’ monthly payments on the loan would repay the bonds over time, so the Legislative Analyst’s Office (LAO) finds no direct state or local cost.
To qualify, an applicant would need to be a California resident, plan to live in the home, and have household income no more than double the typical income in their area. The buyer would also need to be the first purchaser of the home, and the price would need to stay under program limits. The Secretary of State’s Quick Guide describes that price limit as about $1.5 million.
A yes vote creates the program. A no vote leaves it off the books. Whether you are shopping in San Jose, Morgan Hill, or nearby cities, this measure is about new-home buyers who meet those income and price rules, not every purchase.
Proposition 1: $11.25 Billion Housing Bond
Proposition 1 is a general obligation bond package totaling $11.25 billion. Of that, $10 billion would fund a mix of state housing programs and would be repaid from the state General Fund. The other $1.25 billion would support home loans for veterans and would be repaid by those borrowers’ loan payments.
According to the LAO, the main $10 billion piece would cost the state about $500 million to $600 million a year for roughly 25 years. Program buckets include about $7.2 billion for affordable multifamily rental housing, $1.1 billion for homeownership help for low- and moderate-income households, $1.25 billion for veterans home loans, plus smaller amounts for farmworker housing, student housing, tribal housing, infrastructure near affordable projects, and local pilot programs.
The LAO estimates the bond could help subsidize up to about 40,000 multifamily rental units and help up to about 40,000 households with homeownership assistance, including about 2,100 veterans. Those are statewide estimates, not city-by-city forecasts.
Wondering how Props 1 and 37 could affect your next purchase? Reach out to Avil for more information. I am happy to talk through the local side. Call or text 408.807.5657, email home@avilsoleiman.com, or send me a message here.
How They Differ for Buyers
- Who pays: Prop 37 is repaid by participating homebuyers. Prop 1’s $10 billion housing programs are repaid by the state General Fund; the veterans piece is repaid by veteran borrowers.
- Who it helps first: Prop 37 focuses on middle-income buyers of newly built homes under the program rules. Prop 1 spreads money across rental housing, down payment and homeownership aid, veterans loans, and other housing programs.
- Timing: Neither measure changes your closing tomorrow. Both would take time to issue bonds and open or expand programs after a yes vote.
What This Means in the South Bay
Neither proposition sets local zoning or sale prices in Santa Clara or San Mateo County. What they can do is add statewide tools: more down payment help for some new-home buyers (Prop 37), and more funding for affordable rental and ownership programs (Prop 1). If you are comparing neighborhoods in Campbell or elsewhere in the county, treat these measures as background on future assistance options, not a guarantee for any one address.
Props 1 and 37 FAQ
When is the vote?
Election Day is Tuesday, November 3, 2026. Check your county elections office for early voting and mail ballot deadlines.
Does Prop 37 cost taxpayers?
The LAO says Prop 37 has no direct state or local costs because participating homebuyers’ loan payments repay the revenue bonds.
Does Prop 1 cost taxpayers?
Yes, for most of it. The LAO estimates $500 million to $600 million a year for about 25 years to repay the $10 billion General Fund portion. The $1.25 billion veterans loan piece is repaid by veterans’ loan payments.
Will these measures lower South Bay home prices?
Official analyses do not promise lower prices in San Jose or Morgan Hill. They describe funding for programs and possible increases in assisted housing, with many details left to implementation after the election.
Reach Out to Avil for More Information
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