California is finally establishing a state agency dedicated solely to housing and homelessness. Governor Gavin Newsom proposed splitting the existing Business, Consumer Services and Housing Agency into two, creating one that focuses entirely on housing-related departments. Lawmakers allowed the plan to proceed this summer, and the restructuring is now underway.
Supporters see this as long overdue, given that housing affordability and homelessness consistently rank among the state’s top concerns. Advocates believe a cabinet-level housing secretary will elevate the issue and bring more focus to California’s complicated network of affordable housing programs. Critics, however, caution that simply reorganizing departments won’t solve deeper problems like rising construction costs and fragmented financing systems.
While the new agency will coordinate housing subsidies under the governor’s control, key funding sources remain with the state treasurer. Experts note that achieving a unified funding application process — a goal long sought by affordable housing developers — will require close cooperation between the governor and treasurer’s offices.
The transition is set to finalize in July 2026, coinciding with the next statewide elections, when voters will help decide who shapes the future of California’s housing policy.
