Many communities draft their inclusionary housing ordinance to include a formula for establishing the initial price for affordable homeownership units. Getting the details of this initial pricing formula right is very important to the long-term success of the program, but it can be hard to anticipate all of the factors at the outset.
For this reason, some inclusionary ordinances generally state that the homes must be priced at an affordable rate for the target income group, and more detailed language is included in the program guidelines or administrative manual. These guidelines might include things like the mortgage financing assumptions that go into the formula. This approach may make it easier for program administrators to adopt revisions to the pricing formula over time.
