California down payment assistance program for first-generation homebuyers to reopen applications

A popular California program designed to help people buy their first home is making a comeback.

California's Dream For All program is reopening applications next month, offering down payment assistance to eligible first-generation homebuyers struggling to break into the state's expensive housing market.

"It was so popular, it was like Taylor Swift tickets," said Jake DaRosa, a broker with the DeRosa Real Estate Team.

The program, operated by the California Housing Finance Agency, is aimed at people with good credit and stable employment who are trying to purchase their first home.

"It's really challenging to buy a home, especially your first home," said Eric Johnson, with the agency. "Prices are high, interest rates are all over the place, and sometimes it can be really challenging to save up a whole bunch of money in the bank to apply for a down payment."

Eligible buyers can apply for down payment assistance of up to 20% of a home's purchase price, capped at $150,000. DaRosa says that level of assistance can make a major difference.

"It's really aimed at getting that first generation, that person who hasn't owned a home, into a house," DaRosa said. "It's pretty massive."

The program covers a significant portion of the down payment, which lowers monthly mortgage costs. When the home is eventually sold, the buyer repays the down payment to the state, along with a share of the home's increased value.

In 2024, roughly 18,000 people applied for the program, with about 2,000 selected at random through a lottery-style process.

"It's a small number of people we can help if you look at the total population of people in the state," Johnson said. "But for every single one of those people, it changed their lives."

State officials expect to have between $150 million and $200 million available next year. The application window opens February 24 and closes March 16. Housing officials are urging interested applicants to begin talking with their loan officers now, who can help guide them through the application process.