[bouldercouncilhotline] Hotline: Maximum Affordable Rent Determination

[cmosupport at bouldercolorado.gov]

Sender: Jeff Yegian

The following information regarding affordable rents was requested at the Feb. 21, 2012 council meeting:

Maximum Affordable Rent Determination

The City of Boulder establishes maximum rents for affordable housing each year based on the income limit for the unit and its number of bedrooms.  From those two characteristics a household income is calculated and multiplied by 30 percent, the housing expense ratio.  For example, the maximum rent for a two bedroom apartment for households earning up to 50 percent of the Area Median Income (AMI) would be calculated as follows:

2 bedroom X 1.5 people/bedroom = 3-person household
50 percent AMI 3-person household = $42,250 annual income, $3,521 monthly income
$3,521 X 30 percent = $1056 maximum rent

The U.S. Department of Housing and Urban Development publishes the AMI and related income limits on Dec. 1 of each year.  Using 1.5 people/bedroom and the housing expense ratio of 30 percent are affordable housing standards.

Rents so established are maximums and the property owner may charge less.  Rents may not be raised more than once per year or increased above the maximum and property owners must give at least thirty days written notice before rent increases are implemented.

The 2012 maximum rent chart is attached.  Depot Square would use the Inclusionary Housing rents and income limits (highlighted rows).  The income limit is set for a higher percent of AMI than used to calculate the rents to ensure a variety of households can afford those rents.

For additional information, please contact Jeff Yegian, Acting Housing Division Manager, at 303-441-4363 or yegianj at bouldercolorado.gov<mailto:yegianj at bouldercolorado.gov>.
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