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If we are successful in meeting these two objectives, Land Trust homes will always be <br />available & desirable to low-income households <br />What do we mean by affordable? 110 of our 125 homes much be affordable to families <br />earning less than 80°~ of the area median income. <br />15 homes must remain affordable to households earning no more than 100°~ of median <br />income. <br />- For inclusionary housing to be successful, Land Trust homes cannot be allowed to fall <br />into disrepair. <br />How Are We Doing? <br />Our current model: <br />• is not keeping homes affordable due to stagnant HUD income limits, which have not <br />increased since 2003 <br />• was not well designed to ensure long-term maintenance <br />- When the model was established in 1999, the original board and staff recognized that <br />long-term maintenance would be an issue. <br />- But the model that was put in place did not adequately address maintenance because we <br />didn't understand the model well enough. We knew that maintenance would have to be <br />addressed at some future date. <br />Affordability <br />^ Land Trust homes are becoming more affordable relative to home prices <br />- Appreciation is based upon independent appraisals performed when buyers purchase <br />homes and sell them. <br />- Land Trust homes have appreciated at a rate 5.62% annually <br />- But Land Trust homeowners only receive 1.67% annual appreciation <br />- This was how the model was supposed to work -allowing homes to increase in price <br />over time, but becoming more affordable relative to home prices. <br />Affordability <br />^ But land Trust homes are becoming less affordable to buyers because: <br />^ Our home prices increase but HUD income limits are not increasing <br />^ We are instituting a monthly stewardship fee <br />- We can only sell (most of) our homes to individuals and families who earn less than 80% <br />of HUD's area median income. <br />- The 80% HUD limit has been flat since 2004 due to the separation of Wake County from <br />Orange and Durham Counties. <br />The HUD-published maximum income {80°~} for a family of three has been as follows: <br />0 2001 $47,250 <br />0 2002 $48,950 <br />0 2003 $50,850 <br />0 2004 $51,350 <br />0 2005 $51,350 <br />0 2006 $51,350 <br />0 2007 $51,350 <br />We expect these income limits will remain flat until 2010 when we are projecting a 3% <br />annual increase through 2026. <br />