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Our experience tells us that our homeowners are not incepted by our model, nor are they <br />required to perform maintenance. <br />In many cases homeowners simply do not have the financial wherewithal to maintain their <br />properties. <br />Maintenance <br />^ Culbreth Park homes, 15+ years old, have recently been folded into the Land Trust <br />^ Typical needs include new roof, HVAC, water heater, exterior siding, painting, carpeting, and <br />new water supply piping in some cases <br />^ Costs can reach up to $40,000 <br />- Culbreth Park is an affordable housing community built in 1990-1991. Many of the <br />affordable homes have already been sold at market value and are no longer in the <br />affordable housing inventory. <br />- The Town of Chapel Hill, which sponsored Culbreth Park, has recently asked us to look <br />at buying one of the remaining affordable homes. The owner, a single mother who has <br />lived there for 15 years, has been unable to perform maintenance on the expensive items <br />like exterior painting. <br />- As a result, the masonite siding has deteriorated to a point where it needs to be replaced. <br />- The polybutylene supply piping in the water system is also deteriorated and leaking. <br />- The home also needs a new roof, a new heating and air conditioning system, and a new <br />hot water heater. <br />- We estimate the cost of these repairs to be as much as $40,000. <br />- By doing the rigorous analysis we have done and by paying more attention to <br />construction materials, we hope to propose a model that will cause Land Trust homes to <br />be better maintained than this home in Culbreth Park. <br />New Model <br />^ 1.5% fixed annual appreciation <br />^ Monthly stewardship fee <br />^ Repair-replacement schedule for capital maintenance <br />- Our new model provides homeowners a flat rate of appreciation of 1.5% annually. This is <br />somewhat less than the 1.67°lo that our experience has been in the past five years. <br />- V1le believe that 1.5°~ is fair and will keep our homes affordable under normal <br />circumstances. <br />- 1Ne also believe the new model offers the benefit of predictability to the hamebuyers that <br />offset the slight decline in appreciation. <br />- The stewardship fee is designed to pay far replacement of particular capital items such as <br />roofs, HVAC, water heaters, exterior painting, and flooring. <br />- The fee will vary depending upon the particular home. Single family homes that do not <br />have homeowner associations to assist with maintenance will pay a higher monthly <br />stewardship fee than townhomes or condominiums. <br />- The Land Trust will devise arepair/replacement schedule far every Land Trust home. It <br />will only include the capital items listed above. <br />New Model <br />• Stewardship fee only applies when a home is sold into the new model <br />• Deferred maintenance will persist far years <br />• Our current inventory will require deferred maintenance subsidy <br />• It is neither practical nor fair to saddle aloes-income homeowner with expensive capital <br />repairs shortly after purchase <br />