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Judson Brown, City of Santa Ana February 10, 2025 <br />Habitat Wellington – Preliminary Financial Gap Analysis Page 7 <br /> <br /> 2412002v3.SA.TRB <br /> 19090.018.035 <br /> <br />3. The closing costs related to the sale of each affordable unit are estimated at $3,000 per <br />unit, or $27,000. <br />4. Habitat proposes to fund an $8,000 reserve for the Homeowners Association. <br />5. The warranty costs are estimated at $65,000, which equates to approximately $7,200 <br />per unit. <br />KMA estimates the total financing costs at $470,000. <br />TOTAL DEVELOPMENT COSTS <br />As shown in Table 1, KMA estimates the total development costs at $4.40 million. In <br />comparison, Habitat estimates the total development costs at $4.37 million. This represents an <br />approximately $28,000 differential, which equates to less than 1% of the total development <br />costs. <br />Estimated Available Revenue <br />KMA estimates the revenue available to the Project as follows: <br />MODERATE INCOME SALES PRICES – INCLUSIONARY HOUSING FUNDS <br />The City will provide Inclusionary Funds to the Project. As such, KMA estimated the affordable <br />sales as follows: <br />1. The household income used in the calculations is based on the area median income <br />published by the California Department of Housing and Community Development (HCD) <br />and adjusted for the number of persons per household (Area Median Income (AMI)). <br />KMA assumes the household size is estimated at one plus the number of bedrooms <br />(four persons for a three-bedroom unit). <br />2. KMA assumes that the qualifying Moderate Income limits are set at 120% of AMI. <br />3. Since the Project consists of more than four units, the Project is required to have an <br />HOA. Habitat estimates the annual HOA dues at $400 per unit per month. <br />4. Habitat estimates the homeowner’s insurance cost at 0.75% of the affordable sales <br />price. <br />EXHIBIT 5