In order to receive resale credit for major home improvements, owners must comply with the capital improvement policy and be pre-approved by the program before the work starts.
All homes in the program have restrictions that impact owners. Owners need pre-approval to make capital improvements or rent any portion of the home.
Capital Improvement
Sale
You must notify us of your intent to sell your home before listing it. We will provide you with the maximum resale price and promote your home on our website. All homes go through a 30-day open marketing period followed by a fair selection process coordinated by the city. Resale homes are also subject to inspection and may require repair if they do not meet maintenance and upkeep requirements.
Refinance
The covenant recorded for your home lets you refinance for up to 93 percent of the home's maximum resale value. Please notify us of your intention to refinance and we will provide you with the maximum resale value of your home and a letter to share with your lender. Before closing we will review loan documents to confirm that the refinance complies with our mortgage policy and your covenant.
Rental Limitations
The program maintains strict occupancy and rental restrictions to prohibit the homes from becoming income properties:
- Owner occupancy is required.
- Short term rentals (30 days or less) are never permitted for owners of permanently affordable homes per city ordinance.
- Long term rentals of the entire home are limited to one year out of every seven, but not permitted in the first five years. Licensing regulations must be followed.
- When occupied full-time by the owner, a long-term rental of one single room in the home may be permitted after the first year of ownership. Licensing regulations must be followed.
- Licensing regulations must be followed for all rentals.
Going Solar
The City's Solar Grant Program provides financial support for the installation of solar electric and solar thermal (hot water) systems on individual residences that are part of an affordable housing program. Visit the Solar Grant page to learn more and apply.
Frequently Asked Questions
Owners can phone or email the program and ask for a current value.
When a home enters the program, a maximum resale price is set. The maximum resale price of each home is based on the formula in the home’s Permanently Affordable Covenant.
Each year, the value of homes in the program can increase a small amount. This is called appreciation. The amount added is 1% to 3.5% of the home’s purchase price. The allowable appreciation changes each year and is based on the general economy.
Example:
| Transaction | Price |
|---|---|
| Purchase Price | $200,000 |
| Year 1 Appreciation (1%) | $2,000 |
| Year 2 Appreciation (2%) | $4,000 |
| Year 3 Appreciation (1.5%) | $3,000 |
| Home Value After 3 Years | $209,000 |
Sometimes owners make improvements to their homes. For example, they may replace carpet with hardwood floors. The program calls these capital improvements and some of the cost for these improvements can be added to the home’s value with pre-approval. The Capital Improvement Policy describes the process for pre-approval and lists improvements that are eligible.
Example:
| Transaction | Price |
|---|---|
| Purchase Price | $200,000 |
| Year 1 Appreciation (1%) | $2,000 |
| Year 2 Appreciation (2%) | $4,000 |
| Approved capital improvement for replacing carpet with hardwood floors. | $6,000 |
| Year 3 Appreciation (1.5%) | $3,000 |
| Home Value After 3 Years | $215,000 |
Finally, as explained above, some money is added to the home’s maximum resale value to help cover a portion of marketing and closing costs.
Example:
| Transaction | Price |
|---|---|
| Purchase Price | $200,000 |
| Year 1 Appreciation (1%) | $2,000 |
| Year 2 Appreciation (2%) | $4,000 |
| Approved capital improvement for replacing carpet with hardwood floors. | $6,000 |
| Year 3 Appreciation (1.5%) | $3,000 |
| Real Estate Compensation (2.5%) | $5,375 |
| Closing Cost Allowance | $650 |
| Maximum Resale Price | $221,025 |
Property taxes are based on the affordable value – not the market rate value. The program sends home values to the county assessor and the county uses this to determine taxes. Each year, the assessor sends owners information on taxes due. If an owner thinks the wrong information was used, they can call or email the program.
Owners need to make repairs to their home; the program does not maintain homes. In some cases, a Homeowners Association (HOA) may make some repairs. The HOA usually only makes repairs to the building’s exterior. Owners in a building with an HOA should check with the HOA. If it is not covered by the HOA, the owner needs to make the repair.
The program does not have a list of people for making repairs.
The program also does not have money to help people pay for repairs. There may be some other local programs that can help; households usually need to be lower-income and meet other requirements to receive this assistance.
Yes, but it is difficult. The owner first needs to qualify again for the program and sell their home. The program does not allow people to own another home when they purchase a home in the program.
Example:
- Seller A list their program home for sale.
- Buyer B wants to buy this home.
- Buyer B has a program home to sell.
- Buyer B gets qualified again for the program.
- Buyer B enters and wins the selection for Seller A’s home.
- Buyer B lists their program home for sale. Based on the home sale process, it will take 60+ days before this home is sold.
- Seller A does not want to wait 60+ days.
- Seller A moves onto the next person in the selection.
If the children of the owner, spouse or domestic partner are living in the home, they can keep living in the home. This is true even if they were not originally an owner (listed on title to the home). In all other cases, the home will need to be sold. The program will work with the person handling the deceased's affairs to get the home sold. The money from the sale will go to the deceased's heirs.
The city's program is now part of the Boulder Regional Affordable Homeownership Program. Current owners will continue to work with the same city staff and follow the same processes as they previously did.
Homes in the program are limited in how much they increase in value which can make moving into a market rate home challenging. Owners wanting to move to market rate may buy a home with the help of a down payment assistance program.