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Pleasanton Comprehensive Fee Update and Nexus Study November 2024
<br /> Table 19 Affordability Gap Analysis
<br /> Very Low Low Low Median Moderate
<br /> Item Income Income Income Income Income
<br /> 50%AMI 60%AMI 80%AMI 100%AMI 120%AMI
<br /> Multifamily Rental
<br /> Project Development Cost Assumptions (per unit) $595,227 $595,227 $595,227 $595,227 $595,227
<br /> Maximum Supported Home Value
<br /> Household Income $62,300 $74,730 $96,650 $124,550 $149,500
<br /> Income Available for Housing Costs/Year2 $15,528 $19,257 $25,833 $34,203 $41,688
<br /> (less)Operating Expenses per Unit/Year3 ($7,500) ($7,500) ($7,500) ($10,000) ($10,000)
<br /> Net Operating Income $8,028 $11,757 $18,333 $24,203 $31,688
<br /> Capitalization Rate4 5.0% 5.0% 5.0% 5.0% 5.0%
<br /> Total Supportable Unit Values $160,560 $235,140 $366,660 $484,060 $633,760
<br /> Affordability Gap $434,667 $360,087 $228,567 $111,167 -$38,533
<br /> Townhomes
<br /> Project Development Cost Assumptions (per unit) $1,069,670 $1,069,670 $1,069,670 $1,069,670 $1,069,670
<br /> Maximum Supported Home Price
<br /> Household Incomes $77,850 $93,420 $108,990 $140,130 $171,270
<br /> Income Available for Housing Costs/Year7 $27,248 $32,697 $38,147 $49,046 $59,945
<br /> Less Annual Housing Expenses8 $13,167 $14,204 $16,277 $18,350 $21,025
<br /> Income Availably for Mortgage Payments $14,080 $18,493 $21,869 $30,695 $38,920
<br /> Interest Rate 7.0% 7.0% 7.0% 7.0% 7.0%
<br /> Total Supportable Mortgage Amount9 $174,719 $229,478 $271,376 $380,897 $482,955
<br /> Down Payment% 5% 5% 5% 5% 5%
<br /> Total Supportable Unit Value $183,915 $241,556 $285,659 $400,944 $508,374
<br /> Affordability Gap $885,754 $828,113 $784,011 $668,726 $561,295
<br /> Average Affordability Gap $660,211 $594,100 $506,289 $389,946 $261,381
<br /> (1)Incomes are based on 2024 HCD Income Limits for two-person households in Alameda County for rental.
<br /> (2)Assumes 30%of income available for housing related expenses.
<br /> (3)Operating expenses are generally based on EPS feasibility studies in the region and are inclusive of utility costs;lower-income units(at or below
<br /> 80%of AMI)are assumed to be built as non-profit and are,therefore,exempt from property taxes.Property taxes are assumed to comprise a share of
<br /> the operating expenses for the moderate-income category.
<br /> (4)The capitalization rate is used to determine the current value of a property based on estimated future operating income,and is typically a measure of
<br /> estimated operating risk.
<br /> (5)The total supportable unit value is determined by dividing the net operating income by the capitalization rate.
<br /> (6)Incomes are based on 2024 HCD Income Limits for four-person households in Alameda County.Per California Health and Safety Code Section
<br /> 50052.5,incomes for households above 70%AMI are set at a lower percent of AMI than the cutoff,(ex.Moderate Income is 110%of AMI rather than
<br /> 120%).
<br /> (7)Assumes 35%of household income is spent on housing related expenses.
<br /> (8)Includes property tax,mortgage insurance,and utility payments.
<br /> (9)Assumes 30-year mortage term.
<br /> Sources:City of Pleasanton;Alameda County Housing Authority;California Housing and Community Development(HCD);CoStar;Economic&
<br /> Planning Systems.Inc.
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