Picture: The Landed Team
Last week, Landed, a San Francisco Housing Action Coalition member, announced a $5 million investment from the Chan Zuckerberg Initiative. We wanted to check in with their team about all that’s happening with teacher housing, and what’s next. Here’s our chat with Ian Magruder, Landed’s Director of Partnerships.
What is Landed and what are you trying to accomplish?
At Landed, our mission is to help essential professionals build financial security near the communities they serve. One of the ways we do that is by investing alongside them when they are ready to buy an expensive Bay Area home. So instead of needing a 20% down payment, they only need to get to 10% to access the same mortgage options. We believe this makes homeownership more accessible, and keeps our great educators in our communities.
You’ve identified a specific target audience. Why educators?
Educators struggle to save money fast enough for a conforming down payment. They are also some of the most important people to our communities. Every time an educator leaves our community it impacts the quality of education that is delivered to our communities’ children. At the same time, educators have stable salaries and make great homeowners. It’s a no-brainer.
Can educators even qualify for a mortgage at these home prices?
It is clear that many educators are underpaid for the value they provide to our communities. That is another problem that needs addressing. In fact, many single-income educators cannot afford any housing stock within commutable distance of their school. Our assistance is really targeted at dual-income families that have enough income to support home ownership but struggle to save fast enough for a down payment. Our experience is that this represents 20%-40% of educators that are currently renting.
It was recently announced that the Chan Zuckerberg Initiative (CZI) was going to invest in Landed. Why do you think they choose you and how are you going to be effective with the money?
CZI has made education and housing two of their top priorities and they were actively looking for innovative solutions when we began conversations with them last fall. They recognized that down payment assistance helps families immediately and only requires investment capital to solve. It’s the low hanging fruit of the housing challenge. CZI also believed that if they could help prove that this model works in the Bay Area, it could help spur other foundations and family offices across the country to pursue this approach in their communities.
Why do you think the Bay Area housing environment is so crazy and how can it be fixed?
The environment is crazy because land is scarce and lots of people want to live here. The only way to manage that growth without skyrocketing prices is to build more housing density. Sadly though, in progressive democracies, it is really hard to add density to neighborhoods that are already built out. This is not a SF-only challenge, this is a worldwide urban challenge.
To solve it, we need to coordinate our infrastructure, transit and housing plans to solve this problem as a region instead of letting every municipality hope that someone else will build housing. There is also no justification for Prop13 as it relates to rental housing. Keeping Prop 13 for just owner-occupied households would likely increase the salaries of our essential professionals by 10%-20%.
What does your organization want to accomplish over the next few years?
We want to help essential professionals build financial security near the communities they serve. Part of that is making sure every educator in the region can access our down payment assistance, but another important part of that is making sure that they have access to advocates and advisers to help them navigate complicated financial decisions. We want to be as helpful as we can, to as many people as we can.
How has SFHAC played a role in Landed’s success?
SFHAC’s staff has been proactive in asset mapping the San Francisco community, helping us to brainstorm, identify, and connect with potential partners as we work to bring Landed to every Bay Area community.