Orange County NC Website
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22 <br /> 4 <br /> CURRENT SITUATION OR PROBLEM: <br /> Regional Median Income is used by HUD and other agencies in <br /> determining eligibility for various programs. Figures are <br /> published for Metropolitan Statistical Areas (MSAs) <br /> throughout the country. Orange County is included in the <br /> Raleigh-Durham MSA. <br /> HCD defines Moderate Income as 50% to 100% of median income. <br /> Low Income is defined as 30% to 50 % of median income. <br /> Very-low income is defined as <30% of median income. <br /> Median income is adjusted for family size. References to <br /> median income assume a family of 4, unless otherwise stated. <br /> As a rule of thumb (used by HUD) , a family can afford to <br /> spend up to 25% of its gross income on housing, and can <br /> afford to buy a home at a price of roughly 2 1/2 times its <br /> annual income. <br /> The attached letter from HUD shows the results of a 1/4/90 <br /> run of the Housing Affordability Model for Orange County. <br /> Results indicate that only 22% of families in Orange County <br /> can afford to buy a home at the average price of $143,577 . A <br /> family earning 80% of median income could afford to pay only <br /> $66,500 for a home. As income decreases, the availability of <br /> homes in an affordable price range decreases. <br /> For low-income households (30-50% regional median income) , <br /> affordable rent is amore realistic goal because home <br /> ownership may not be feasible. According to U.S. Census <br /> figures for 1980, 35% of the 16, 618 renter-occupied units in <br /> Orange County were occupied by low-moderate income <br /> households . Eighty-four percent of those households paid <br /> more than 25% of their income for housing costs. For those <br /> families, resources available for other basic needs such as <br /> food, health care, child care, and clothing are limited. <br /> Decent housing within an affordable price range is not <br /> available for many of these families . <br /> PROPOSED SOLUTION: <br /> The supply of affordable housing may increase if an incentive <br /> is offered to developers. One such incentive is a density <br /> bonus which would allow the creation of additional dwelling <br /> units if units were sold or rented to families earning low or <br /> moderate incomes. The incentive for a developer to use the <br /> provisions is greatest where land values are high, most . <br /> typically in urbanized areas. In Orange County, the density <br /> bonus is most likely to be used by non-profit organizations <br /> already intending to develop affordable housing, or by <br /> developers/landowners with suitable land of lesser value to <br /> donate in exchange for a density increase. <br />