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38 <br /> • Fair Return on Investment: $30,300 x 0.294= $8,908 <br /> • Resale Price: $190,000+$8,908 = $198,908 <br /> Affordability to a Range of Buyers <br /> The Consortium will ensure continued affordability to a range of buyers, particularly those whose <br /> total household incomes range from 60 to 80%of area median income (AMI) as calculated by HUD <br /> for the HOME Program. Sales price will be set such that the amount of principal, interest,taxes, and <br /> insurance does not exceed 30%of the new buyer's annual income. <br /> In the event the resale price required to provide a fair return exceeds the affordability to a range of <br /> LMI buyers, additional HOME funding will be provided to the subsequent buyer based on the level of <br /> funds required to make the unit affordable. <br /> Principal Residency Requirements <br /> Households receiving HOME-funded homeownership assistance will be required to occupy the home <br /> as their principal residence throughout the HOME Affordability Period. <br /> In the event the original HOME-assisted homebuyer no longer occupies the unit as their principal <br /> residence (i.e.,the unit is rented or vacant),the homeowner will be in violation of the terms of the <br /> HOME assistance. In cases of noncompliance,the Consortium will enforce the terms of the HOME <br /> written agreement to require repayment of any outstanding HOME funds invested in the housing. <br /> The amount subject to repayment is the total amount of HOME funds invested in the housing(i.e., <br /> any HOME development subsidy to the developer plus any HOME direct assistance provided to the <br /> homebuyer) minus any HOME funds already repaid (i.e., payment of principal on a HOME loan). <br /> Noncompliance with principal residency requirements by a homebuyer is not considered a transfer <br /> and is not subject to resale provisions. <br /> The Consortium will enforce these requirements through a HOME written agreement executed with <br /> the organization receiving the HOME award for homeownership activity to protect its investment <br /> and minimize its risk in HOME-assisted homebuyer projects in the event the homebuyer is in <br /> noncompliance. <br /> 4. Plans for using HOME funds to refinance existing debt secured by multifamily housing that is <br /> rehabilitated with HOME funds along with a description of the refinancing guidelines required <br /> that will be used under 24 CFR 92.206(b),are as follows: <br /> The Orange County HOME Consortium does not intend to refinance any existing debt for multifamily <br /> housing that will be rehabilitated with HOME funds. <br /> Discussion <br /> The Market Analysis found that Orange County has high housing costs and insufficient units for low- <br /> income households, particularly extremely low-income households earning below 30%AMI—only 5% of <br /> rental units in the County are affordable to households at this income level. As such, the Consortium has <br /> identified the need for tenant-based rental assistance, and has been HOME funds and local Match funds <br /> to fill this gap. <br /> Annual Action Plan 35 <br /> FY 2024-2025 <br />