What Is Shared Appreciation? The Dream For All Trade, Explained
Dream For All is not a grant and not a plain loan. You repay what you borrowed plus a share of your home's appreciation. Here is exactly how that works, with a real example of what you would owe.
How shared appreciation works
Most down payment help is either a grant (you keep it) or a loan (you repay the dollars you borrowed). Shared appreciation is a third kind. In exchange for a large down payment now, up to 20% of the price, you agree to hand back a slice of your home’s future gain when you eventually sell, refinance, or pay off the mortgage. You repay the original amount you borrowed, plus that agreed share of the appreciation. If your income is above 80% of area median, the share is up to 20% of the gain; at or below 80% AMI, it drops to 15%. There is no monthly payment along the way.
A real example
Say you buy at $500,000 and take a $100,000 Dream For All loan (20% down). Years later you sell for $700,000, a $200,000 gain. If your share is 20%, you repay the original $100,000 plus 20% of the $200,000 gain, $40,000, for $140,000 total. You keep the other $160,000 of appreciation plus all the principal you paid down. And there is a backstop: the appreciation share is capped at 2.5 times the original loan, so on that $100,000 it could never exceed $250,000 no matter how much the home gained. If the home had not gone up at all, you would repay just the original $100,000.
Is the trade worth it?
That is a personal call, and we will not push you either way. For a first-generation buyer who would otherwise spend a decade saving a California down payment, giving up some future upside to own now often makes sense, you are building equity and stability the whole time. If you expect to sell quickly or the market is flat, the shared appreciation matters less. What we do is run your actual numbers so the decision is informed. Read the full program terms on our Dream For All page.
Common questions
What is shared appreciation in Dream For All?
It means that in exchange for a large down payment (up to 20% of the price), you repay the original loan plus a share of your home's future appreciation when you sell, refinance, or pay off the mortgage, up to 20% of the gain for incomes above 80% AMI, up to 15% at or below, capped at 2.5 times the original loan.
Do I owe appreciation if my home does not gain value?
No. With Dream For All, if your home does not appreciate, you repay only the original loan amount you borrowed. You only share appreciation that actually occurred, and even then the share is capped at 2.5 times the original loan.
Is shared appreciation a good deal?
It depends on your situation. For a first-generation buyer who would otherwise spend years saving a California down payment, sharing some future upside to own now often makes sense. If you expect to sell quickly or in a flat market, it matters less. Running your actual numbers is the way to decide.
Run the Dream For All numbers
Tell us your county, credit range, and price target, and we’ll map your California path in a no-pressure 20-minute call. No obligation.