San Francisco Prop C (2026): what the Housing Trust Fund change means for down payment loans

San Francisco voters approved Proposition C on November 3, 2026, in unofficial returns. It changes the city’s Housing Trust Fund in three ways: more money each year, fifteen more years, and down payment loans for households earning up to twice the area median income. None of it applies until the Secretary of State files the amendment. Here is what each change does and when, from the Charter text.

Checked against the enacted text of the certified legal text of the Charter amendment · Updated November 8, 2026

At a glance

What it is: A Charter amendment to Section 16.110, the Housing Trust Fund the city pays into from its General Fund each year.
Down payment loans: Once the amendment takes effect, Trust Fund money for first-time buyers’ down payment loans can reach households earning up to 200% of area median income, up from 120%.
More money: A faster funding formula from fiscal 2028-29, projected to reach $125 million a year by fiscal year 2034-35, against about $65 million under the old formula.
Longer life: The fund would run to July 1, 2058 instead of July 1, 2043.
New tax?: No. It is a General Fund set-aside, money redirected from the rest of the city budget.
Result: Passed with 81.5% yes in unofficial returns; certification by December 3, 2026.

Down payment loans up to 200% of area median income

The change a household can use: once the amendment takes effect, Trust Fund money for first-time buyers can go to higher earners.

Section 16.110(e)(2) used to let the Housing Trust Fund pay for down payment loans only to households earning up to 120% of area median income (AMI). Prop C raises that to 200% once it takes effect, and lets the Board of Supervisors adjust the limit by ordinance “based on market conditions.” First responders keep their own limits, set by the Mayor’s Office of Housing and Community Development (MOHCD).

The program those loans fund is DALP, the Downpayment Assistance Loan Program. DALP already accepted buyers up to 200% of AMI, but each pool of money carries the limit of its funding source. In the 2025 lottery, $6 million of the general pool was limited to households at 120% of AMI and $4.6 million was open up to 200%. Prop C lets the Trust Fund’s share serve the higher band too, once it takes effect, so more of the money is open to middle-income buyers. How MOHCD splits future pools is up to MOHCD.

San Francisco homeownership income limits, MOHCD 2026 (effective June 1, 2026)

Household size	1	2	3	4	5	6
120% of AMI (old Trust Fund limit)	$136,150	$155,650	$175,100	$194,500	$210,050	$225,650
200% of AMI (new limit)	$226,900	$259,400	$291,800	$324,200	$350,100	$376,100

These are MOHCD’s figures from HUD’s 2026 median income for San Francisco, unadjusted for high housing costs, which is the table DALP uses. A household of four earning between $194,500 and $324,200 is the group Prop C adds for Trust Fund loans.

How a DALP loan works

From MOHCD’s DALP Manual (September 2025).

Amount: up to $500,000, as funds are available, and no more than the buyer needs.
Payments: no interest and no monthly payment. The loan is due when you sell or transfer the home, or break the program’s rules, such as renting it out.
Repayment: the loan plus a share of any appreciation. The share is the loan divided by the home’s value at purchase, the lower of the price or the appraisal. At repayment, MOHCD takes the greater of the resale price or a new appraisal as the value. MOHCD’s example: a $500,000 loan on a $1.5 million home means a 33% share. If the value hasn’t risen, you repay the principal only. The promissory note controls.
Who: first-time buyers (in the general pool, no ownership interest in any home, anywhere, in the past 3 years; in the educator and first-responder pools, none in San Francisco) buying a primary residence in San Francisco, within the income limit, who complete homebuyer education and are pre-approved by a MOHCD-approved lender.
How chosen: by lottery, run as MOHCD announces it, with separate pools for SFUSD educators and first responders. MOHCD’s 2026-27 program fee is $682, charged after the lottery and income pre-approval.

Applying: Prop C doesn’t open a new application. Watch MOHCD’s DALP page and sign up for its housing alerts for the next lottery. We found no MOHCD announcement on how Prop C will change the next round’s pools as of November 8, 2026.

How much money, and the new formula

About $50 million went into the fund in fiscal 2024-25. Prop C is projected to take it to $125 million by fiscal year 2034-35.

Under the old Charter text, the contribution grew each year with the city’s General Fund discretionary revenue. Prop C keeps that rule for fiscal 2027-28. From 2028-29, the city must pay the greater of:

last year’s amount plus 20% of the city’s share of new 1% property tax revenue from the growth in assessed value; or
last year’s amount grown by the percentage increase, if any, in discretionary revenue.

Starting the fiscal year after the contribution first reaches or exceeds $125 million, it grows only with discretionary revenue, by no more than 3% a year (Section 16.110(c)(3)). The Controller projects $6 million more than current law in 2028-29 and $13 million in 2029-30, rising by about $9 million a year to $60 million more in fiscal year 2034-35, when the total would be $125 million against about $65 million without the measure. Those projections assume no freezes or cuts.

Freezes and cuts. Through 2057-58, the city may freeze the contribution at its current amount in a year when the projected deficit exceeds $250 million (indexed to discretionary revenue from 2028-29), or cut it by up to 10% in a year when it may withdraw from the Rainy Day Reserve. Either takes a standalone ordinance in the budget process. After a cut, the formula restarts from the last year without one. Separately, a power in the existing text stays and is extended to 2057-58: if the Controller lowers the discretionary revenue estimate for a budget period, the Board may by ordinance reduce that period’s contribution in proportion to the shortfall (Section 16.110(c)(5)).

The Controller also notes the measure doesn’t comply with a non-binding city policy discouraging new voter-adopted spending requirements, which already total about $2 billion, roughly 30% of General Fund sources.

What the fund can pay for

Under Section 16.110(e) as amended, once in effect, MOHCD spends the fund on:

creating, acquiring and rehabilitating rental and ownership housing affordable to households up to 120% of AMI, expressly including limited-equity housing cooperatives and social housing developments as the city code defines them, and land for them;
down payment loans, up to 200% of AMI as above;
housing stabilization for current occupants up to 120% of AMI, to reduce the risk of losing their home or make it safer, more accessible or more energy efficient;
housing-related infrastructure needed to support residential development, replacing the Complete Neighborhoods Infrastructure Grant Program, which hasn’t been funded since fiscal 2019-20; and
the fund’s administrative and legal costs.

The Board can still issue revenue bonds or other debt backed by the fund for affordable housing up to 120% of AMI. Prop C also deletes obsolete text, including the old inclusionary-housing interim rules and the option to reduce the contribution for redevelopment housing bond debt service.

Key dates

When	What happens
July 14, 2026	The Board of Supervisors votes 11–0 to place the Charter amendment on the ballot.
November 3, 2026	Voters approve Proposition C, in unofficial returns.
By December 3, 2026	The Department of Elections certifies the results.
After certification	The amendment takes effect when the Secretary of State accepts and files it (Government Code 34459). The higher income limit for down payment loans and the new uses apply from then.
Fiscal year 2028-29	The new funding formula starts. The Controller projects about $6 million more than under current law that year.
Fiscal year 2034-35	The annual contribution is projected to reach $125 million. From the next fiscal year, growth is capped at 3% a year.
July 1, 2058	The Housing Trust Fund sunsets, 15 years later than before (July 1, 2043).

The Board of Supervisors placed the amendment on the ballot 11–0 on July 14, 2026. The vote shown is the unofficial count as of November 4, 2026, 7 a.m.: 252,446 yes to 57,135 no. Under Government Code 34459, an approved Charter amendment takes effect once the Secretary of State accepts and files it.

Prop C and the state’s Prop 37 loan

California voters also approved Proposition 37, a state loan of up to 17% of the price of a new home for buyers up to 200% of area median income. The two are different programs with different rules: DALP is for first-time buyers of a market-rate home in San Francisco, deferred and repaid with a share of appreciation; Prop 37 is for the first purchaser of a new or newly converted home, with monthly payments. They may also measure “200% of AMI” from different income tables. MOHCD uses HUD’s unadjusted San Francisco median, $162,100 for four in 2026; CalHFA hasn’t said which it will use for Prop 37. And because Prop 37 requires the buyer’s 3% to come from money that isn’t a loan or grant, a DALP loan can’t supply it.

Our San Francisco analysis looks at which downtown buildings could be converted to housing, the other way the city is trying to add homes.

Questions

Did San Francisco Prop C pass in 2026?

Yes, in unofficial returns: 81.5% yes to 18.5% no as of November 4, 2026, 7 a.m.. The Department of Elections certifies results by December 3, 2026, and a Charter amendment takes effect when the Secretary of State files it.

What does SF Prop C do?

It amends Charter Section 16.110, the Housing Trust Fund. It raises how much the city must put into the fund each year from fiscal 2028-29 until the contribution reaches $125 million, extends the fund from 2043 to 2058, lets the city freeze or trim the contribution in budget emergencies, raises the income limit for down payment loans from the fund to 200% of area median income, and adds limited-equity cooperatives, social housing and housing infrastructure to its uses.

Does Prop C raise taxes?

No. It requires the city to set aside more of its existing General Fund for housing. The Controller estimates the added cost at about $6 million in fiscal 2028-29, growing to about $60 million a year by fiscal year 2034-35, money that would otherwise be available for other city spending.

What is the income limit for San Francisco down payment assistance?

DALP, the city’s Downpayment Assistance Loan Program, allows household income up to 200% of area median income, which on MOHCD’s 2026 table is $324,200 for a household of four. Each pool of DALP money can carry its own lower limit; before Prop C, loans paid from the Housing Trust Fund were capped at 120% ($194,500 for four).

How much is a DALP loan and how is it repaid?

Up to $500,000, as funds allow. Under MOHCD’s manual it has no interest and no monthly payment. You repay it when you sell or transfer the home or break the program’s rules, plus a share of any appreciation: the loan divided by the home’s value at purchase (the lower of price or appraisal). A $500,000 loan on a $1.5 million home means a 33% share.

Who can get a San Francisco DALP loan?

First-time buyers: in the general pool, no ownership interest in any home in the past 3 years; in the educator and first-responder pools, none in San Francisco in that time. Buyers must be purchasing a primary residence in San Francisco, have income within the limit, complete homebuyer education and get pre-approved by a MOHCD-approved lender. Loans are awarded by lottery, run as MOHCD announces them. Pools are also set aside for SFUSD educators and first responders.

When does Prop C take effect?

The Charter change takes effect when the Secretary of State accepts and files it, after the city certifies the results. The higher income limit and new uses apply from then; the bigger funding formula starts in fiscal 2028-29.

Can the city cut Housing Trust Fund money under Prop C?

Temporarily. It can freeze the contribution at the current amount in a year when the projected budget deficit exceeds $250 million (indexed from 2028-29), or cut it by up to 10% in a year when the city may draw on its Rainy Day Reserve. Either needs a standalone ordinance in the budget process, and after a cut the formula resumes from the last uncut year. The Board can also reduce a year’s contribution in proportion to any shortfall when the Controller lowers the revenue estimate.

Sources

More California law: Office to Housing Conversion Act (AB 507) · New California housing laws for 2027 · Prop 37 homebuyer loan · California’s new housing laws and Ro Khanna

Federal law: The ROAD to Housing Act explained · Environmental review changes · CDBG and HOME changes · Opportunity Zones · The 2027 Opportunity Zone map · The Innovation Fund · Innovation Fund reforms, city by city · Housing permits in every CDBG city · The Build Now Act · Manufactured housing and the chassis rule · Chassis-free manufactured homes by state · Manufactured home zoning by city · RESIDE Act funding status · How RESIDE grants should be sized · Which buildings meet the RESIDE test · The ban on large investors buying homes