Housing Land Trust Resale Sample

Land Trust Homeownership: Example of a Resale
How is the resale price of a home determined? The price of the house is tied to the appreciation in Area Median Income.
	Example:
		Initial Median Income: $74,600 (annual income for a family of four at 100% of AMI in 2004-05)
			What If:
			Annual change in Incomes = 4% Could be more, could be less
		10 years later
			Median Income would be: $110,426
		(48% total increase – due to compounding) Initial Purchase Price: $300,000
			If
			Change in Median Income = 48%
			Then:
			Maximum Price = $444,073 Total Appreciation = $144,073
		Total equity = Appreciation + Debt Reduction + Down payment
			Avg. Rate of Income Increase	2%	4%	6%
			Maximum Price in 10 years	$365,698	$444,073	$537,254