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3 <br />Further, it is estimated that approximately 12,280 of all households in Orange County (44,854) <br />were considered very low income, with incomes between 0 -50 percent of median family income <br />(MFI). <br />HOUSING AND COMMUNITY <br />DEVELOPMENT NEEDS <br />Conditions <br />The high cost of'homeownership has forced many families to purchase housing in other counties <br />and commute into Orange County for work. The inflation of the rental market by University of <br />North Carolina- Chapel Hill (UNC -CH) students has caused hardships for families with incomes <br />below 50 percent of MFI. Larger rental units are particularly scarce. <br />Market Conditions <br />According to the Orange County Economic Development Commission, the average new home <br />sales price in 1999 was $247,661, and for an existing home the price was $200,601. To purchase <br />this new home a low income family of four persons would have to spend approximately 7.9 times <br />their annual wages. For an existing home, the family would have to spend approximately 6.4 <br />times their annual wages. In both of these instances, the low- income family needs to have more <br />money than they earn and is certainly well above the HUD standard for affordable housing. <br />(U. S, Department of HUD standards define affordable owner occupied housing as purchasable at <br />2.5 to 3.0 times total family annual income.) <br />The rental housing market, inflated by the ability of University of North Carolina at Chapel Hill <br />students able to pay market rents, is beyond the means of families with incomes below 50% of <br />the area median. In 2000, it is estimated that rental units represent 43% of the county -wide <br />housing market and approximately 67% of those rental households experience an extreme cost <br />burden — paying between 30% to 50% of their income for rental housing. <br />Each year, HUD publishes existing housing Fair Market Rents (FMRs) for metropolitan areas <br />and non - metropolitan counties in the country. These FMRs are based on the fortieth percentile <br />of standard quality rental units occupied by recent movers. Public housing units, newly <br />constructed units, and substandard units are excluded from the calculations. FMRs are <br />established by unit size (number of bedrooms) and include an allowance for utilities. <br />Experience in Orange County has shown that local rents often run an average of 15 to 20 percent <br />higher than those HUD published rates, which explains why such a high percentage (35 %) pay <br />more than 50% of their income for rental housing costs. <br />For families earning 80% or more than the County median monthly family income of $4,022 <br />renting a multi- bedroom apartment is relatively easy given that they are able to locate units with <br />3 or more bedrooms. Larger apartments are in relative scarcity because the rental market is <br />oriented toward providing student rental housing. The most recent County data estimates that <br />24% of the County's rental properties contain three or more bedrooms. <br />