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37 <br /> B. The home must remain the owner's principal residence throughout the HOME Affordability <br /> Period; and <br /> C. The conditions and obligations of the owner should the owner wish to sell before the end of the <br /> HOME Affordability Period, including; <br /> 1. The owner must contact the Orange County HOME Consortium or its designated <br /> representative in writing if intending to sell the home prior to the end of the HOME <br /> Affordability Period; <br /> 2. The subsequent purchaser must be low-income as defined by HOME regulations, and <br /> occupy the home as their primary residence for the remaining years of the HOME <br /> Affordability Period (however, if the new purchaser receives HOME direct assistance, <br /> the HOME Affordability Period will be re-set according to the amount of assistance <br /> provided); and <br /> 3. The sales price must be affordable to the subsequent purchaser; affordable is defined as <br /> limiting the Principal, Interest,Taxes and Insurance (PITI) amount to no more than 30% <br /> of the new purchaser's monthly income. <br /> (continued below) <br /> 3. A description of the guidelines for resale or recapture that ensures the affordability of units <br /> acquired with HOME funds?See 24 CFR 92.254(a)(4)are as follows: <br /> (continued from above) <br /> Fair Return on Investment <br /> The Consortium must ensure the owner receives a fair return on their investment and that the <br /> home will continue to be affordable to a specific range of incomes.To calculate the fair return on <br /> investment to the homeowner, the Consortium will: <br /> A. Determine the amount of market appreciation, if any, realized over the ownership term by <br /> calculating the difference between the initial appraised value at purchase and the current appraised <br /> value at resale.This figure represents the basis for calculating the fair return on investment. In <br /> declining markets, it is possible that the homeowner may not realize a return. <br /> B. Multiply the basis by the Federal Housing Finance Agency's Housing Price Index(HPI)to <br /> determine the fair return to the homeowner: <br /> https://www.fhfa.gov/DataTools/Tools/Pages/HPICalculator.aspx <br /> To calculate the resale price to the next homebuyer, the Consortium will add the fair return on <br /> investment to the homeowner to the original affordable price of the home at purchase by the <br /> original buyer. <br /> Example#1: <br /> • Appraised (Fair Market)Value at Purchase: $210,000 <br /> • Affordable Price at Purchase: $190,000'iAA ?Appraised Value at Resale: $240,300 <br /> • Increase in Market Appreciation: $240,300-$210,000=$30,300 <br /> • Average Appreciation in the Raleigh-Durham MSA (per the HPI Calculator): 29.4% <br /> Annual Action Plan 34 <br /> FY 2024-2025 <br />