The City of Davis Affordable Homeownership Program offers an opportunity for income and asset qualified households to purchase a home locally at below market cost. The program does not provide loan or down payment assistance. Individuals must be able to obtain a loan and any necessary down payment required by the lender and afford the mortgage payment. See the Guidelines for Buyers for more details.

No, the City does not publish a list of available properties. Those who are on the Affordable Homeownership Waitlist are contacted in rank order when a home becomes available.

The sales price of the property is restricted to a 3.75 percent appreciation per year from its original date of sale, compounded annually. Southfield Park (the homes on Greene Terrace) is the only exception with appreciation restricted to 5.5 percent annually.

The owner is required to occupy the affordable home as their primary residence for the entire duration of his/her ownership of the home.  Such occupancy must commence within six months following completion of the purchase.

• Everyone on the title must live in the home.
• No co-signers are allowed on the purchase.
• The home in its entirety or any part of the home may not be rented.
• The home is not permitted to be in a living trust in order to meet the occupancy requirements.
• The owner is not permitted to own any other residential unit.

Each owner must execute a Declaration of Owner Occupancy at purchase and annually as required by the city.

Owners must notify the City of Davis in writing if they intend to take an extended vacation lasting one or two months during which time the owner will not be occupying the home. The home may NOT be rented in the interim.

In instances where the purchaser(s) of the affordable home intends to add new persons to the deed, the new household must re-certified to meet the city’s income restrictions.

In instances where the purchaser(s) vacate the affordable home for more than 180 days without requesting and gaining an approved exemption from the city, the purchaser(s) will be required to sell the unit upon the city’s written direction unless otherwise approved by the city.

The owner(s) of an affordable home must intend to occupy the home for a minimum of 24 consecutive months before selling. If the owner needs to sell early, they must contact the City of Davis in writing and ask for an exemption.

First-time home buyers that can income and asset qualify (see Program Eligibility Requirements on the City’s website Affordable Ownership Information webpage) and are ready to purchase a home. To qualify to purchase an affordable home through the City’s program your income cannot be higher than 120% of the Yolo County Area Median Income (AMI) and most likely will not be below 80% of AMI. The housing debt to income ratio must be no greater than 35%.

• Review the information on the City of Davis website Affordable Ownership Information page. Learn about the program, the income and assets limits, and deed restrictions on the properties.

• Review the Guidelines for Buyers and the Frequently Asked Questions for Buyers and Sellers.

• If you think you will qualify for a loan, agree to the deed restrictions, and think you will income and asset qualify for the program contact the City of Davis at:affordablehousing@cityofdavis.org and asked to be added to the Waitlist to purchase an affordable home.

The Waitlist is organized in rank order. The Waitlist number you receive when placed on the list will change as people drop off the list due to the purchase of an affordable home, asking to be removed from the Waitlist or being removed from the Waitlist for passing three times on the opportunity to purchase a home.

When an affordable home is ready to be viewed, the first eight potential buyers on the Waitlist will be notified by email by the City that they may view the property.

Potential buyers have three-business days to view the home AND let the City of Davis know if they are interested in taking the next steps in income and asset qualify. Potential buyers interested in purchasing the home, notify Affordable Housing staff and begin the income and asset qualifying process.

If potential buyers are not interested in purchasing the home, they notify Affordable Housing staff and pass on the home. Those on the Waitlist who pass three times will be removed from the Waitlist.  Those who fail to notify City staff of their decision to pass will also have a pass against them. 

Anyone wishing to rejoin the Waitlist can let Affordable Housing staff know that they are interested after 24-hours has passed since they were removed.  At that time, they will fill out and return the Waitlist Questionnaire to Affordable Housing staff and if they qualify, they will be placed on the Waitlist.

The City of Davis Affordable Homeownership Program provides an opportunity for low to moderate-income families to achieve the goal of homeownership by purchasing a home locally at a below market cost.

To qualify for this equal opportunity program, applicant(s) must meet the following criteria:

• Affordable ownership units will be affordable for low to moderate income households, households with incomes ranging from eighty percent of area median income to one hundred twenty percent of area median income (AMI), with the average affordability targeted at households with incomes at one hundred twenty percent of AMI, the moderate target income. To qualify a household’s gross annual income cannot exceed moderate-income levels for Yolo County calculated at 120% of area median income (AMI).  The United States Department of Housing and Urban Developments (HUD) determines the income limits per household size. The City of Davis is unable to make any exception to this requirement. Annually, HUD publishes new Income Limits. These are available on the City of Davis website and are updated annually. 

• Have no more than $250,000 in cumulative assets.  Households with assets that exceed $250,000 are automatically disqualified from the program. The following are considered assets: gifts, stocks/bonds, equity in property, retirement accounts (there are some exemptions), life insurance, lump sums and deeds.; and

• Buyer monthly mortgage payments shall be no more than thirty-five (35) percent of gross monthly income for an affordable unit including mortgage principal and interest, taxes, insurance, assessments, and homeowner fees, as applicable and adjusted for household size (Davis Municipal Code Section 18.05.020).

We look at the last three months of income. 

No, the city looks at what they will be making to qualify them.

Yes, lawful permanent residents can use their green card as proof of residence to get financing to buy a home.

U.S. citizenship is not required to obtain an FHA loan, but an immigrant must have lawful permanent residence status, have nonpermanent residency status or be a DACA recipient.

If I own a home, can I purchase an affordable home?

Beginning in 2024, households were no longer added to the Affordable Home Ownership Waitlist if they own a home.  Those on the Waitlist prior to January, 2024 may own a home but only they have no more than $250,000 in assets when they make an offer on the home even if they claim they will not have this as equity when they sell their home.   

No, the program is designed to help as many households as possible to obtain an affordable home with the hope that this will launch them eventually into a fair market home and open up their affordable home for another household. The program is NOT designed to move the same people amongst affordable homes as this is not equitable.

Is gift money allowed?

The program allows buyers to receive gift monies that will go directly into the escrow account. A gift for a loan to purchase a home refers to a sum of money given to a homebuyer by a third party (typically a family member or close friend) that does not need to be repaid. A gift letter is required from the gift giver stating that this is a gift and that no repayment is required. Any gift monies will be counted towards part of the assets and the City must receive bank statements from the gift giver showing the money is in their account.

Are loans (in addition to the loan from your mortgage allowed?

No

My child will be attending college in Davis and I want to buy an affordable home for them. Will they qualify?

No, this program is designed for low-income households not for students whose parents can afford to buy their child a home while attending college. In addition, everyone listed on the loan/title must reside in the household. And, everyone residing in the household must include their income when qualifying.

Can one spouse be on the loan and both spouses be on the title?

Both parties on the title must be on the loan. Likewise, both parties on the loan must be on the title. If the couple is married, it is possible for one spouse to obtain a loan and go on title but the other spouse must sign a Quit Claim agreeing to this.

The other alternative is to obtain a letter from the lender stating that one partner/spouse is on the loan but both partners/spouses will be vested in title on the Deed of Trust.

No, if more than one person purchases the unit, all purchasers must occupy the unit.

No, homes that are in the Affordable Home Buyers Program cannot be placed into living trust. Please refer to the City of Davis Municipal Code 18.04.040.

Once you purchase a home, you can make any modification or renovations since this is your home. You will need to check the building department for required permits and inquire with the HOA, if you have an HOA, regarding any stipulations. Please keep in mind that any modifications will not be reflected in the sales price.

Close of Escrow

Anyone wishing to close escrow in less than 30 days must first discuss this with the Affordable Housing staff to determine whether this is possible.

If you have experience with real estate and legal documents then you may not need a realtor. However, for most people, having your own realtor is beneficial and is strongly recommended for both buyer and seller.  Using the seller’s realtor may not be in the buyer’s best interest. It may be beneficial to find a realtor who is familiar with the City of Davis Affordable Homeownership Program to assist you through this process.

The City of Davis does not make recommendations on finding a lender, but using someone local that understands the City’s Affordable Homeownership Program and someone who has worked with first-time home buyers will be helpful.

The City of Davis does not make recommendations on finding a lender, but using someone local that understands the City’s Affordable Homeownership Program and someone who has worked with first-time home buyers may be helpful. Please direct all loan related questions to your realtor or lender.

Yes, the 1% administrative fee paid by the seller to the City of Davis and is calculated from the sales price of the home. Buyers are not allowed to pay this fee or reimburse the seller for this fee. If an owner or their realtor is asking you to pay this fee, please contact the City of Davis Affordable Housing staff immediately.

Are realtor’s commissions split?

Until recently, in a typical sales transaction, the commission was generally paid by the seller. When the City advances a qualified buyer, both the buyer and seller must negotiate in good faith to determine: a) a fair sales price (not to exceed the maximum sales price), b) commission for the buyer and seller’s realtors and c) timing for close of escrow.  The program is design to be non-competitive. Fees associated with the sales transaction should not unduly burden the buyer.

The commission for both the buyer and seller’s realtors is to be negotiated between the buyer and the seller but the total commission for each realtor may not be more than 2.5% and the buyer shall not pay a greater percentage than the seller. Please see the Division of Fees and Commissions handout for more information.

I have decided that I want to sell my affordable home, what do I need to do?

The first step is to contact the City of Davis Affordable Housing staff at affordablehousing@cityofdavis.org and let them know you would like to sell your home.

Staff will send you a Notice of Intent to Sell form which you will fill out and return. Everyone's name who is on title must sign this form. Please allow City staff least 14 days to calculate the maximum sales price for your home before you intend to begin showing your home to potential buyers on the Waitlist.

I am considering selling my house in the next 6 months to a year, can you calculate the sales price for me?

No, the sales price is based off the date the home intends to go on the market. When the seller has decided to put the home on the market, they must submit a Notice of Intent to Sell form and choose a date to put the home up for sale. The City of Davis is unable to provide any estimated sales prices without an owner taking these steps. These steps should only be taken when the owner knows they will put their home up for sale in the next three months.

How is the price determined for the resale?

The City of Davis calculates the sales price is based on a 3.75% appreciation per year from its original date of sale, compounded annually. Southfield Park is the only exception with an appreciation cap of 5.5% per year. The appreciate cap cannot be adjusted.

Can I negotiate the price to set for the home?

No, the appreciate cap is pre-determined and cannot be adjusted.

If I make any renovations or modifications will this increase the sales price?

No, renovations or modifications will not be included into the sales price. The appreciation cap is already determined and cannot be adjusted. Any renovations or modifications will not be included into the sales price. This is to ensure and maintain affordability.

Do I have to sell my home for the price the City of Davis provides?

No, the sales price provided to the seller can always be LOWERED to encourage sales if a home is not selling.  However, it CANNOT INCREASE from the maximum sales price provided to the seller.

Setting the date to begin showing your home to potential buyers from the Affordable Homeownership Waitlist 

You will determine a date you wish to start showing your home in coordination with Affordable Housing staff so they are able to notify potential buyers from the Affordable Homeownership Waitlist that they can view your home. 

What happens during the first 60-business days of the home being up for sale?

During the City’s Right-of-First refusal, the City has the right to either make a purchase offer for your property or submit a qualified buyer of its choosing from the Affordable Homeownership Waitlist.

Affordable Housing staff will reach out to potential buyers on the Affordable Homeownership Waitlist to determine their interest in viewing the property. Those interested will schedule an appointment with you or your realtor (whomever you specified on the Offer Notice) to see the home within 72 hours AND let the City of Davis know if they are interested in taking the next steps to income and asset qualify. 

You will only be showing your property to those on the Waitlist for the first 60-business days.  Anyone viewing the home who was not sent by the City is expressly disqualified from making a purchase offer. The seller must make their home available for viewing to ALL potential buyers SENT BY THE CITY during this three-day window. It is NOT be acceptable for the seller or the seller’s realtor to tell potential buyers they must wait to see the property after the three-business day window closes or force potential buyer to wait for the weekend to see the property during an open house.

Those interested in purchasing will then proceed through the income and asset qualification process with the City of Davis. No offers are to be made by the buyer before they are qualified and the seller is not allowed to accept an offer or start negotiating an offer until the City informs the seller that a person from the Waitlist has been qualified to make an offer.

As soon as the City has an eligible buyer, meaning they have income and asset qualified, the City will notify the seller. The seller and the buyer have three-business days to negotiate the purchase agreement. In order to keep the process moving, the fully executed contract needs to be signed within three-business hours of the City informing the seller of the eligible buyer(s).  The fully executed contract will be sent by the seller’s agent to the City of Davis the day it is signed.

The buyer and seller must close escrow within 90 days from the Offer Notice being received by the City of Davis.  

If the City of Davis fails to make a purchase offer for the property or present a qualified buyer within the 60-business day Right-of-First-Refusal period, the seller is free to select his or her own buyer. The City will let the seller know when the 60-business days end and they are free to find their own buyer.

After the 60-business day Right-of-First-Refusal period ends, buyers are not required to income and asset qualify with the City to make a purchase offer to the seller. However, the property must not sell for more than the City of Davis calculated maximum sales price and ALL other deed restrictions apply.

The property must be listed on the Metrolist MLS within one day of the City informing the seller that an eligible buyer from the Waitlist has not been found and the seller is now free to find their own buyer. You will know what this date is before your home goes on the market. Your realtor must list the property on the MetroList MLS for both the agent’s and the public’s viewing. The listing must state that this is a deed restricted affordable home.

Attempts to subvert the City’s Affordable Home Ownership Program Guidelines or violate fair housing laws may result in legal action.

The maximum sales price is effective for 90-days from the date the City receives the Notice of Intent to Sell.  

If the City chooses not to exercise its Right of First Refusal and the owner fails to transfer the Restricted Unit within six months of the Offer Notice, then the City’s Right of First Refusal goes back into effect. 

If the owner takes the home off the market for any period of time, the City’s Right of First Refusal goes back into effect. 

Commission and Fees

Until recently, in a typical sales transaction, the commission was generally paid by the seller. When the City advances a qualified buyer, both the buyer and seller must negotiate in good faith to determine: a) a fair sales price (not to exceed the maximum sales price), b) commission for the buyer and seller’s realtors and c) timing for close of escrow.  The program is design to be non-competitive. Fees associated with the sales transaction should not unduly burden the buyer.

The commission for both the buyer and seller’s realtors is to be negotiated between the buyer and the seller but the total commission for each realtor may not be more than 2.5% and the buyer shall not pay a greater percentage than the seller. Please see the Division of Fees and Commissions handout for more information.

There is a 1% administrative fee paid by the seller to the City of Davis and is calculated from the sales price of the home. Buyers are not allowed to pay this fee or reimburse the seller for this fee. If an owner or their realtor is asking you to pay this fee, please contact the City of Davis Affordable Housing staff immediately.

Close of Escrow

• The buyer and seller must close escrow within 90 days from the Offer Notice being received by the City.
• The buyer is not to pay any commission for their realtor or the seller’s realtor.
• The City of Davis will collect a fee of 1% of the purchase price from the seller for program administration.
• Anyone wishing to close escrow in less than 30 days must first discuss this with the City as Affordable Housing staff need to send loan paperwork to the title company.