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lower home prices, buying a home for lower income buyers remains a challenge. Stricter <br />underwriting standard by lenders has eliminated many buyers with lower income and <br />marginal credit from obtaining a home purchase loan. As reported by the Orange County <br />Register, during the 2"d quarter of 2009, average Orange County rents have decreased <br />approximately 3.6% to $1,470/month. This is consistent with the average rent of <br />$1,400/month reported by the Housing Authority of Santa Ana; however, even with <br />declining rents, the County of Orange estimates that a household needs to earn over $25.50 <br />to rent an average priced one-bedroom unit.11 Housing costs continue to pressure the City <br />to identify resources to expand affordable rental and home ownership opportunities, <br />especially for lower income households. <br />^ Increased labor and material costs have reduced the effective amount of money the City <br />has to fund activities. The cost of raw materials and more recently the cost to transport <br />materials have also had a significant impact on the cost of public facilities construction <br />projects and housing rehabilitation. <br />^ Since 2001, HUD grants to the City have steadily decreased. In recent years the elimination <br />of the CDBG program was proposed; in its place a new program was proposed that would <br />have significantly reduced eligible uses of federal funds and the amount of funds that would <br />be allocated to the City. <br />5. What adjustments or improvements to strategies and activities might meet community <br />needs more effectively? <br />As the City completes the fourth year of the 2005-2003 Consolidated Plan cycle new priority <br />activities have come to light. Recently the residents and City Council have placed a new <br />emphasis on addressing gang issues in the City and also the level of deterioration of City <br />streets. With respect to the latter, the City contemplated applying fora 108 Loan, the proceeds <br />of which would have been utilized to reconstruct neighborhood streets; however, the City has <br />opted to utilize other funding resources to undertake the bulk of street reconstruction; CDBG <br />will still be used via annual allocations. <br /> <br />36 <br />Draft 8/26/2009 <br />19F-42 <br />