Apple Commits $2.5 Billion to Fight California Housing Crisis

[MacRumors]

Apple on Monday announced that it would commit $2.5 billion to easing a housing shortage that has seen property prices skyrocket across California.

Apple's commitment includes $1 billion in affordable housing investments, $1 billion in mortgage assistance for first-time homebuyers, and $300 million worth of Apple land opened up to affordable housing projects.

"Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home, and we feel a profound civic responsibility to ensure it remains a vibrant place where people can live, have a family and contribute to the community," said Tim Cook, Apple's CEO. "Affordable housing means stability and dignity, opportunity and pride. When these things fall out of reach for too many, we know the course we are on is unsustainable, and Apple is committed to being part of the solution."

Apple is also launching a new $150 million affordable housing fund with Bay Area partners including Housing Trust Silicon Valley to support new affordable housing projects. The fund will consist of long-term forgivable loans and grants.

Tim Cook and California Governor Gavin Newsom, discussing the land Apple is freeing up for affordable housing​

"This unparalleled financial commitment to affordable housing, and the innovative strategies at the heart of this initiative, are proof that Apple is serious about solving this issue. I hope other companies follow their lead," said Gavin Newsom, governor of California. "The sky-high cost of housing -- both for homeowners and renters -- is the defining quality-of-life concern for millions of families across this state, one that can only be fixed by building more housing. This partnership with Apple will allow the state of California to do just that."

In addition, Apple will donate $50 million to support Destination: Home's efforts to address homelessness in Silicon Valley. Apple says it will focus its contribution on driving systemic change across the many factors affecting homelessness. Apple will also be identifying similar efforts in Northern and Southern California, focusing on strategies that both end and prevent homelessness.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Article Link: Apple Commits $2.5 Billion to Fight California Housing Crisis

 

[adamw]

Gotta get those housing prices down... Maybe Apple should move their HQ to a state other than California which has lower housing prices and taxes. I am sure many other states and communities would greatly desire Apple to move there and would give them all kinds of tax breaks and incentives to relocate.

 

[zappa2001]

Remember in the movie “Robocop” and OCP was building Old Detroit. Apple is becoming OCP.

 

[Pepe4life]

Perhaps Gavin Newsom can spend less taxpayer money on illegal aliens and use the money on Americans in need.

 

[newdeal]

so what is the payback for shareholders with this? Its still a publicly traded company Tim

 

[falkon-engine]

WoW. This is amazing. I still wish they’d fix the memory issues with iOS. But this has my vote 100 percent. Let’s see if other companies around the world that have copied Apple also follow its lead now.

 

[Gutwrench]

I think $2.5 billion in U-haul rentals ought to clean up the California homeless problem.

 

[ArtOfWarfare]

so what is the payback for shareholders with this? Its still a publicly traded company Tim

The idea is to improve brand image and reduce the number of people buying non-Apple products just because they hate Apple as a company.

Sales of iPhones are dwarfed by sales of Android phones, and sales of Macs are dwarfed by sales of PCs. Apple needs to do something to win those people over if they’re to continue growing.

Increasing prices only decreases marketshare.

If you don’t think this tactic will work, you don’t have to own shares of AAPL. Feel free to sell - the price is at its all time high now, so if you think it’ll be going down, no reason you wouldn’t sell.

 

[rwzdoorn]

The first thing that came to mind:

https://www.sidewalklabs.com . 'Apple freeing up space' ...

 

[ThyleUllar]

so what is the payback for shareholders with this? Its still a publicly traded company Tim

Supporting the community of its headquarters is supporting Apple itself. Apple needs the area to be affordable for its own prospective employees and their families, and a place they want to stay. They may lose potential or current employees if the community is not affordable for them or the others that are needed to support it—like the first responders mentioned in the press release. Maintaining the cost of living inflation will also reduce the inflation of Apple’s own payroll.

Then there’s the whole PR goodwill thing.

This is just as much a strategic business move for Apple as it is a community investment.

 

[PickUrPoison]

Gotta get those housing prices down... Maybe Apple should move their HQ to a state other than California which has lower housing prices and taxes. I am sure many other states and communities would greatly desire Apple to move there and would give them all kinds of tax breaks and incentives to relocate.

Apple locates where the employees they want to attract are living (or would like to live).

Apple has facilities in many states, but there’s a reason so many companies are located in Silicon Valley, San Francisco and the East Bay.

 

[swingerofbirch]

so what is the payback for shareholders with this? Its still a publicly traded company Tim

The idea is to improve brand image and reduce the number of people buying non-Apple products just because they hate Apple as a company.

Sales of iPhones are dwarfed by sales of Android phones, and sales of Macs are dwarfed by sales of PCs. Apple needs to do something to win those people over if they’re to continue growing.

Increasing prices only decreases marketshare.

If you don’t think this tactic will work, you don’t have to own shares of AAPL. Feel free to sell - the price is at its all time high now, so if you think it’ll be going down, no reason you wouldn’t sell.

None of this is charity.

It's dressed up like charity.

They are operating like a bank, offering cash to governments and NPOs and getting interest in return. They have plenty of money so I guess they might as well.

And when they say they are making their land available for housing, what they mean is that they are willing to sell it.

They are giving nothing away. Keeping it in cash they'd be losing money over time. Interest rates are so low. This gives them a way to make a little interest and look good while doing it, and yes, maybe help solve a problem at the same time.

 

[Gutwrench]

so what is the payback for shareholders with this? Its still a publicly traded company Tim

Rolling my eyes, Mr Gekko. The Board of Directors would have approved this.

 

[Cndnmax]

Gotta get those housing prices down... Maybe Apple should move their HQ to a state other than California which has lower housing prices and taxes. I am sure many other states and communities would greatly desire Apple to move there and would give them all kinds of tax breaks and incentives to relocate.

The problem with lowering housing prices is that it would screw over everyone that currently owns a house. We saw this in the last housing crash where prices dropped and people owed more than the house was worth. House prices should always go up, California just screen themselves early on by jumping too high too quick.
now if they want to cut property taxes and interest rates, I’m all for it.

 

[PickUrPoison]

Supporting the community of its headquarters is supporting Apple itself. Apple needs the area to be affordable for its own prospective employees and their families, and a place they want to stay. They may lose potential or current employees if the community is not affordable for them or the others that are needed to support it—like the first responders mentioned in the press release. Maintaining the cost of living inflation will also reduce the inflation of Apple’s own payroll.

Then there’s the whole PR goodwill thing.

This is just as much a strategic business move for Apple as it is a community investment.

Nice first post. Cogent, well stated and rather complete. Welcome newbie!

 

[RogerWilco]

Beyond the pale — House?

 

[BootsWalking]

It's a nice gesture but mostly window dressing that won't move the needle in bringing affordable housing to the area. Much of the money is targeted toward lending, which does nothing to improve affordability - in fact it exacerbates the issue by increasing the supply of funds chasing a scarce resource. Just look at what that strategy did to the price of higher education. It helps those with an immediate need but increases prices for future buyers.

 

[keysofanxiety]

Remember in the movie “Robocop” and OCP was building Old Detroit. Apple is becoming OCP.

Oh boy... SIRI-209 would be terrifying.

“You have 20 seconds to comply.”

”Hey Siri, stand down!”

“I’m sorry, I didn’t find anything on the web for ‘standrown’. You have 10 seconds to comply.”

 

[Misuteri]

After this announcement bad land and forest management immediately resulted in the burning the affordable housing to the ground leaving the blacked out neighborhoods empty again. To wit Governor Newsome blamed white people and President Trump.

 

[macfacts]

Apple land lol

 

[simonmet]

If they paid a fair rate of tax (ie not practically nothing) in my State/Country they’d have more funds for social housing too.

Paying tax should not be voluntary, Apple! As individuals we can’t get away with it. Why should you?

 

[Muzzakus]

Give the man a meal, feed him for a day, teach him to Tim Cook, feed him for a lifetime.

 

[yaxomoxay]

Rolling my eyes, Mr Gekko. The Board of Directors would have approved this.

you mention Wall Street, I give like. Simple.

 

[JRobinsonJr]

Rolling my eyes, Mr Gekko. The Board of Directors would have approved this.

True, but that does not guarantee the shareholders agree with the tactic.

 

[I7guy]

I’d like an affordable penthouse on Central Park south.