The eleven (11) affordable homes at CohoMadison will be made affordable by utilizing two approaches. First, we will be discounting the sale price relative to our market-rate units by an average of $25,909 per unit. And second, we have worked with the City of Madison and our partner mortgage lenders to put together a package of subsidy funding (up to $62,000 for first-time homebuyers) that will significantly reduce the size of your first mortgage.
Affordability will be maintained at resale in two ways. First, the “soft second” mortgage will be assumable for buyers with incomes at or below 80% of area median income, significantly reducing the size of the first mortgage. And second, while the resale formula will not be finalized until the first quarter of 2019, we expect it will be similar to the following: (a) the initial purchase price of the Unit, plus (b) annual appreciation equivalent to the 20-year average of annual increases in median income in the Madison Metropolitan Statistical Area.