Buyer Eligibility for Workforce HousingEligibility for the for-sale component of the Workforce Housing Program depends on the household meeting employment or residency requirements, and income and asset requirements (to read the Eligibility Requirements for Buyers, click
here ).
Realtor Guidelines & Information
The Department of Housing and Neighborhood Preservation (DHNP) is currently accepting applications from eligible households for placement on its waiting list for the opportunity to purchase a Workforce Housing Unit. Eligible buyers will be referred for purchase at the appropriate time and will be given a certificate identifying them as an eligible buyer of a workforce housing unit. The eligible buyer will have seven days to visit the site, sign a sales agreement and submit it with an earnest money deposit. Should the eligible buyer decide not to purchase a unit, they will retain their position on the waiting list and have the opportunity to purchase a unit in the next development to be built. Additionally:
Eligible buyers must meet the qualifications and underwriting standards of a mortgage lender who is acceptable to the city. The city reserves the right to reject any lending which it considers to contain deceptive, predatory or abusive terms. All lenders must be Virginia Housing Development Authority (VHDA)-approved and listed on VHDA’s Web site.
“Grossing-up” of income is strictly prohibited
Housing is generally considered affordable if no more than approximately 30 percent of a household’s gross annual income is spent on direct housing costs. These costs include PITI and homeowner’s association dues and/or condominium fees, but not utilities or other related housing costs. However, the Workforce Housing Program will allow a housing ratio of up to 32 percent with a debt ratio not to exceed 43 percent.
Sales Prices of workforce housing units are the fair market value as determined by a Market Approach to Value appraisal.
The Discounted Sales Price is the consideration paid for a workforce housing unit to the developer (new construction). However, in the case of a resale, the Discounted Sales Price is the difference between the sales price and the amount of funds provided by the city to help buy down the eligible buyer’s first mortgage.
The Workforce Housing Discount is the difference in sales price (market value) of a workforce housing unit, and the Discounted Sales Price necessary to make such unit affordable to a household at a targeted income group. The City of Virginia Beach will hold a second mortgage for the amount of the Workforce Housing Discount that carries a zero percent interest rate, requires no monthly payments, and is due and payable to the city upon resale or transfer of the unit.
The Workforce Housing Program is a
Shared Appreciation Program (to read about Shared Appreciation, click here ). Workforce housing units carry
Resale Restrictions (to read about the resale restrictions, click here). In the case of a resale, if the seller of a workforce housing unit decides to utilize the services of a real estate agent, the MLS must indicate that the unit is only available to eligible buyers from the city’s Workforce Housing Program waiting list for the first 90 days. After the initial 90-day period, if no eligible buyer from the city’s waiting list desires to purchase the unit, it may be sold to the general public. If the workforce housing unit is sold to a buyer from the general public, that unit is no longer a workforce housing unit and Workforce Housing Program requirements no longer apply to the new buyer.
Workforce housing units carry
Refinance Restrictions (to read about the refinance restrictions, click here).