Affordable Pricing & Resale Formulas
Creating lasting affordability depends upon determining an affordable initial price and selecting a resale formula that will ensure ongoing affordability. For this reason, affordable pricing and resale formulas are closely related and should be considered together. Below, you’ll find information about the theories and practices behind affordable pricing and resale formula prices.
Every resale formula attempts to strike an equitable balance between providing a fair return to the seller household and ensuring an affordable price to the homebuyer household. This Burlington Associate handout will help you identify your primary and secondary goals.
Resale formulas are tailored to accomplish the specific goals that a nonprofit corporation has set out for itself and for its homeowners. Here is a QuickTime presentation by Burlington Associates.
There are four main types of resale formulas-- indexed, itemized, appraisal-based and mortgage-based. This chart, by Burlington Associates, compares the distinct advantages and disadvantages of each approach.
This general purpose educational tool was designed by Burlington Associates to help community leaders understand the relative performance of different limited equity resale formulas.
Written Materials & Publications
CLT TECHNICAL MANUAL- Chapter 12. Edited by Kirby White. (2011). National Community Land Trust Network.