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11 <br /> (2) Tenants who no longer qualify as low-income families must pay as rent the lesser of the amount <br /> payable by the tenant under State or local law or 30 percent of the family's adjusted income, except <br /> that tenants of HOME-assisted units that have been allocated low-income housinq tax credits by a <br /> housing credit agency pursuant to section 42 of the Internal Revenue Code of 1986 (26 U.S.C. 42) <br /> must pay rent governed by section 42. In addition, in rp ojects in which the Home units are <br /> designated as floating pursuant to paragraph (j) of this section, tenants who no longer qualify as low- <br /> income are not required to pay as rent an amount that exceeds the market rent for comparable, <br /> unassisted units in the neighborhood. <br /> (j)Fixed and floating HOME units. Ina rp oject containing HOME-assisted and other units, the <br /> participating jurisdiction may designate fixed or floating HOME units. This designation must be made <br /> at the time of rp oject commitment in the written agreement between the participating jurisdiction and <br /> the owner, and the HOME units must be identified not later than the time of initial unit occupancy. <br /> Fixed units remain the same throughout the period of affordability. Floating units are changed to <br /> maintain conformity with the requirements of this section during the period of affordability so that the <br /> total number of housing units meeting the requirements of this section remains the same, and each <br /> substituted unit is comparable in terms of size, features, and number of bedrooms to the originally <br /> designated HOME-assisted unit. <br /> (k)Tenant selection. The tenants must be selected in accordance with 92.253(d). <br /> (I)Ongoing responsibilities. The participating jurisdiction's responsibilities for on-site inspections and <br /> financial oversight of rental rp ojects are set forth in § 92.504(d). <br /> [61 FR 48750, Sept. 16, 1996, as amended at 62 FR 28929, May 28, 1997; 62 FR 44840, Aug. 22, <br /> 1997; 78 FR 44672, July 24, 20131 <br /> § 92.254 qualification as affordable housing: Homeownership. <br /> (a)Acquisition with or without rehabilitation.Housing that is for acquisition by a family must meet the <br /> affordability requirements of this paragraph (a). <br /> (1)The housing must be single family housing. <br /> (2)The housing must be modest housing as follows: <br /> (i) In the case of acquisition of newly constructed housing or standard housing, the housing has a <br /> purchase price for the type of single family housing that does not exceed 95 percent of the median <br /> purchase price for the area, as described in paragraph (a)(2)(iii) of this section. <br /> (ii) In the case of acquisition with rehabilitation, the housing has an estimated value after rehabilitation <br /> that does not exceed 95 percent of the median purchase price for the area, described in paragraph <br /> (a)(2)(iii) of this section. <br /> (iii) If a participating jurisdiction intends to use HOME funds for homebuyer assistance or for the <br /> rehabilitation of owner-occupied single-family properties,the participating jurisdiction must use the <br /> HOME affordable homeownership limits provided by HUD for newly constructed housing and for <br /> existing housing. HUD will provide limits for affordable newly constructed housing based on 95 percent <br /> of the median purchase price for the area using Federal Housing Administration (FHA) single family <br /> mortgage program data for newly constructed housing, with a minimum limit based on 95 percent of <br />