AgdaPkt 2021.04.26 Joint SA FPA - Laserfiche WebLink

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7.A. - Page 94 of 101 value of qualifying improvements made to the property andlor to make necessary repairs to put the unit into a sellable condition - 3) The actual sales price shall be the lessor of the Eligible Resale Price or the fair market value. Community -wide appreciation of property values will be con sidered when calculating fair market value. The City will use sales price data provided by the San Mateo County Association of Realtors. or its successors, to allow the property owner the same appreciation rate as the rest cf the community if it does not exceed the Eligible Sales Phce- CALCULAMN TO DETERMINE FAIR RETURN OF INVESTMENT The City of Redwood City has established an eligible resale price calculation and fair rate of return calculation far horneowners wanting to sell their properties within the affordability period - The homeowner is entitled to a fair return on investment made in the property. The Fair Return of Investment is determined by the percentage change of the original purchase price and the Eligible Resale Price of the home times the homeowner's investment; including down payment, principal payments and Qualifying Improvements - The eligible resale price is a sales price that results in a housing cost that is affordable to a reasonable range of low-income homebuyers with Principal, Interest, Taxes, Insurance (PITT) not to exceed % of gross income. This amount may be adjusted to account for the value of qualifying improvements made to the property andfor to make necessary repairs to pLlt the unit into a sellable condition. Qualifying improvements are any capital improvements, opposed to repairs and maintenance, made by the homeowner. The total value of the Qualifying Improvemenks shall be limited to a total of ten percent (10%) of the original purchase price- In order to be deemed as a qualvng im provement, each improvement must satisfy the fol lowing criteria= a) The cost of the improvement must exceed one percent (1%) of the original purchase prtDe- b) The improvements must have a remaining expected useful life of at least five (5) years beyond the completion of the proposed transfer or sale. Eligible Resale Price Percent of Sales Price at Original Purchase = mange Percent Homeowner Investment Fair Return 100 ) of X (Dawn Payment, Principal Payments, = of Change Qualifying Improvements) Investment Annual Action Plan 2021 OMB Control No: 2506-0117 (exp. 06/30/2018) :N 501