40,000 California Housing Units are Stuck in ‘Financial Purgatory’

A lack of sufficient funding is holding back the construction of hundreds of ‘shovel-ready’ projects.

1 minute read

March 10, 2026, 7:00 AM PDT

By Diana Ionescu @aworkoffiction


Two-story apartment or condo building under construction behind green construction fence in Cupertino, California.

Homes under construction in Cupertino, California. | bluestork / Shutterstock

Financial strain is holding back close to 40,000 housing units in the production pipeline in California, according to reporting by Ben Christopher in CALmatters.

The data comes from a report from Enterprise Community Partners, a nationwide affordable housing nonprofit, which found that 461 “shovel-ready” projects are waiting in limbo, fully designed and permitted but without sufficient funds to start construction. Each funding delay can set back a project by an average of four months and add over $20,000 in cost per unit. “With a combination of number crunching and a little inference, the report estimates that clearing the current backlog would require an extra $4.1 billion, split between state administered grants, low-cost loans and tax write-offs.” 

To date, California has allocated roughly $1.8 billion for affordable development this year, with no new discretionary spending in Gov. Newsom’s proposed budget for the upcoming fiscal year. But some changes are coming: “The California Housing and Homelessness Agency is scheduled to take over the state’s disparate housing loan and grant programs,” and lawmakers are considering a $10 billion affordable housing bond measure for the November ballot.

Monday, March 9, 2026 in CALmatters

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