What It Takes to Build Affordable Homes for Our Communities: A Complete Guide to San Francisco’s Affordable Housing Pipeline

Affordable Homes

Introduction
Building affordable homes isn’t just about hammer and nails. In a city like San Francisco, where the cost of living soars and space is at a premium, creating quality affordable housing requires a complex mix of public funding, nonprofit leadership, community advocacy, and years of careful planning. This document, published by San Francisco’s Mayor’s Office of Housing and Community Development (MOHCD), provides a detailed look into what affordable housing really means, how it gets built, where projects stand today, and most critically what is needed to speed up delivery.
What Is Affordable Housing? Defining the Term

Before diving into the pipeline, it’s essential to understand what “affordable housing” actually means. According to federal guidelines, housing is considered affordable when a household spends no more than 30% of its gross income on rent or mortgage payments, leaving enough for food, healthcare, transportation, and other essentials. When a household pays more than 30%, they are considered cost-burdened, a reality for many in San Francisco.

Affordable homes is not necessarily low-quality or public housing. Instead, it refers to homes that are subsidized so that lower-income households can live in them without sacrificing basic needs. Rents for these units are set relative to the Area Median Income (AMI) for the San Francisco region. For example, a one-person household at 25% AMI has a very different income level and rent cap than a household at 80% AMI. The document highlights that San Francisco currently has over 36,000 subsidized affordable homes for low- and moderate-income residents, representing about 9% of the city’s total housing stock.

Who Builds 100% Affordable Housing?

Unlike market-rate housing, which is typically built by for-profit developers, 100% affordable housing in San Francisco is almost exclusively developed by nonprofit and mission-driven organizations. These developers handle everything: securing financing, designing buildings, obtaining entitlements, managing construction, and then operating and maintaining the properties over the long term.

The City of San Francisco does not directly build or manage housing. Instead, it provides local funding, coordinates with state and federal agencies, and partners with these nonprofit developers. This public-private-nonprofit partnership is the engine behind most new affordable homes. The document includes photos from MOHCD showing construction sites and completed projects, affordable homes, emphasizing that while the City enables the work, the actual building is done by experienced housing developers with a social mission.

How are new affordable homes being developed in San Francisco?

The document outlines three primary ways affordable housing is created or preserved:

  1. Produce New 100% Affordable Housing – This involves designing and constructing new buildings specifically for lower-income households. Land for these projects can come from public land (owned by the city, state, or federal government), purchased sites on the open market, land dedicated by market-rate developers, or partnerships with nonprofits and religious institutions. Public subsidy is almost always required to make these projects financially feasible.

  2. Acquire and Rehabilitate Existing Affordable Housing – Instead of building new, the City and its partners also preserve existing affordable homes by acquiring apartment buildings or public housing and rehabilitating them. This ensures that naturally occurring affordable housing doesn’t get converted to market rate, displacing long-term residents.

  3. Require Inclusionary Below Market Rate (BMR) Units – Under San Francisco law, market-rate residential projects with 10 or more units must include affordable units, pay a fee, or donate land. These are known as Inclusionary BMR units. They account for approximately 25% of all affordable units in the pipeline. Market-rate developers either build these units on-site or contribute to the affordable housing fund.

The Affordable Housing Pipeline: What It Is and Why It Matters

The “Affordable Housing Pipeline” is a publicly available list of housing projects in various stages of development. It includes both publicly funded 100% affordable projects (new construction and rehabilitation) and privately funded BMR units within market-rate developments. Many projects in the pipeline are either partially funded or completely unfunded. The City updates this data regularly and makes it available on the DataSF website.

As of the document’s latest data, there are more than 12,600 units across over 59 fully affordable homes pipeline projects waiting to move forward. However, being in the pipeline does not guarantee construction. Most of these projects are stuck in early phases design, community engagement, entitlements, site upkeep because they lack full funding. Affordable developers rely on local funds to leverage state and federal dollars, but the competition is fierce, and funding is never guaranteed.

Where Is Affordable Homes Located in San Francisco?

The document includes a map showing that most affordable homes in the pipeline is concentrated on the east side of the city, including neighborhoods like the Tenderloin, Chinatown, Mission, SoMa, Western Addition, Bayview, and Potrero Hill. Historically, these areas have allowed multifamily housing, while western, central, and northern parts of the city have had more exclusionary zoning policies that make it harder to build affordable homes.

To address this imbalance, San Francisco launched the Expanding Housing Choice Rezoning Program. This initiative aims to change exclusionary housing policies and allow more affordable housing in neighborhoods like the Sunset, Richmond, and other parts west of Twin Peaks. The City, advocates, and affordable developers are working together to acquire new sites, reutilize publicly owned land, and partner with religious institutions to expand housing equitably across the entire city.

Which Affordable Projects Are Stuck in the Pipeline?

The document provides a neighborhood-by-neighborhood breakdown of pipeline projects awaiting funding. Here are some notable examples:

Italics in the document denote rehabilitation efforts, showing that preservation of existing affordable homes is just as important as new construction. Many of these projects are moving slowly due to lack of funding, high labor costs, expensive materials, and rising interest rates.

How Does Market-Rate Housing Add Affordable Units?

Market-rate developments with 10 or more units are required to support affordable housing in one of three ways: build BMR units on-site, pay an in-lieu fee, or donate land for affordable housing elsewhere. These are called Inclusionary BMR units, and they make up roughly 25% of all affordable units in the pipeline.

Currently, there are over 2,500 affordable BMR units across more than 124 privately funded market-rate projects in the pipeline. However, these projects are also facing feasibility barriers. High construction costs, expensive materials, labor shortages, and rising interest rates have stalled many market-rate developments, which in turn delays the delivery of their required affordable units.

How Many Units Are Actually Under Construction?

While the previous lists show projects stuck in earlier phases, the document notes that as of Summer 2025, San Francisco had 2,299 affordable homes under construction across 30 fully affordable homes projects. These include both new construction and acquisition/rehabilitation of existing affordable housing. All of these projects are made possible by local, state, and federal funding. However, even these active construction projects face challenges, and many more units remain stuck because funding has not been secured.

What Does the Affordable Housing Pipeline Need to Deliver Projects Faster?

The document is unequivocal: more funding is the most critical need. To meet San Francisco’s affordable housing production goals over the next eight years, the City will need to dramatically increase funding from all levels of government.

Over the past decade, three local bond measures have raised over $1.2 billion for affordable housing, and the City has provided additional general fund dollars. This increased investment allowed San Francisco to double its affordable housing production and preservation. However, even that is not enough. The document argues that doubling funding sources again through local and regional measures would significantly increase production.

San Francisco cannot solve this alone. Expansion of regional, state, and federal programs is essential. The primary federal tool is the Low-Income Housing Tax Credit (LIHTC), which provides tax incentives for private investment in affordable homes. The City typically provides about one-third of the funding for affordable projects, drawn from General Obligation bonds, the City’s General Fund, and impact fees on market-rate development. The rest must come from state programs, federal tax credits, investors, and banks.

Receiving funding is a highly competitive process. Demand far exceeds availability, creating long timelines and uncertainty. In San Francisco, high costs for materials, labor, construction, and infrastructure result in an average per-unit cost of over $900,000. That means even a modest 100-unit building can cost $90 million or more, requiring an intricate patchwork of funding sources.

How Do You Get Access to Affordable Housing and Who Gets Priority?

Affordable housing in San Francisco is managed through the DAHLIA San Francisco Housing Portal. Anyone can apply for affordable rental and ownership units online. While applicants are selected by lottery, there are preferences for certain groups, including:

Waitlists are extremely long because demand far outstrips supply. Financing the affordable housing pipeline is the only way to alleviate these pressures over time. The document encourages readers to learn more and access the portal at housing.sfgov.org.

The Role of Community Advocacy

Community advocacy has played a crucial role in shaping San Francisco’s affordable homes landscape. Residents and advocates have fought for decades to secure affordable homes in neighborhoods like the Tenderloin, Chinatown, Mission, SoMa, Western Addition, and Bayview areas that experienced significant displacement. Now, the City and advocates are working to expand affordable housing into other parts of San Francisco where housing pressures exist but exclusionary policies have limited options.

Communities can highlight specific housing needs, get involved in advocacy at the local, regional, state, and federal levels, and work directly with nonprofit affordable housing developers to identify buildings for preservation or sites for new construction. The document emphasizes that public support and political will are just as important as dollars.

Conclusion: A Crisis of Funding, Not Ideas

San Francisco has the plans, the sites, the developers, and the community will to build tens of thousands of affordable homes. The Housing Element calls for a dramatic increase in production, and the City has already acquired land and begun the entitlement process for many projects. However, the single greatest barrier remains funding.

Without a massive infusion of local, state, and federal dollars, the affordable homes pipeline will remain mostly a list of unfunded dreams. Every project stuck in early phases represents families, seniors, disabled individuals, and working parents who continue to pay more than 30% of their income on rent, or who have already been forced to leave the city they call home.

The document ends with a call to action: learn more from the Affordable Housing Strategies section of the Housing for All webpage and access additional resources on the MOHCD website. For a city that prides itself on progressive values and community resilience, building affordable housing isn’t just a technical challenge it’s a moral one. And as this document makes clear, the tools and plans are ready. What’s missing is the will to fund them.

Also Read: 28 Post-Neoliberal Housing Policy Ideas