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Exhibit I <br />AFFORDABLE SALES PRICE <br />Income criteria used to determine affordable sales price and affordable housing cost are based on <br />standards imposed by the Ordinance and California Health and Safety Code Sections 50093 and <br />50052.5. <br />Certain assumptions are used in calculating both the Affordable housing cost and the Affordable <br />Sales Price for the Affordable Units in this Project. <br />Affordable housing costs include reasonable costs associated with owning a housing unit. These <br />include: <br />• Principal and interest payments for the Affordable Unit with a 10% down payment <br />• Private mortgage insurance (if applicable) <br />• Property taxes and assessments <br />• Homeowner's insurance <br />• A reasonable allowance for utilities <br />• A reasonable allowance for unit maintenance; and <br />• Homeowners maintenance association dues (HOA) <br />The maximum Affordable Sales Price for an Affordable Unit is the total sales prices a typical <br />Moderate Income Household (up to 120% of median income), adjusted for the household size <br />appropriate for the unit size, can afford to pay for housing. Accordingly, the Affordable Sales Price <br />for the Affordable Units in this Project will be as set forth below unless the Household income of <br />the Moderate Income Household exceeds 110% of Area Median Income adjusted for household <br />size, in which case the Affordable Sales Price shall be recalculated in accordance with California <br />Health and Safety Code ("HSC") Section 50052.5 and the actual income of the Homebuyer to <br />calculate the Affordable Sales Price for that Homebuyer. Affordable Sales Price shall be <br />recalculated quarterly and upon annual release of AMI for Orange County by HCD, in accordance <br />with HSC Section 50052.5. Further, the calculation of the Affordable Sales Price will be based on <br />actual unrestricted rate price estimates, the percentage of income allocated to housing pursuant to <br />Health and Safety Code § 50052.5, actual homeowner's association dues, utility costs (based on <br />similar projects) and a commercially reasonable interest rate at the time the Homebuyer enters into <br />a Residential Purchase Agreement with Developer, or its successor in interest. In the event that the <br />actual interest rate available for the Supportable Mortgage is less than the interest rate set forth <br />herein, Developer may elect to recalculate Affordable Sales Price based on actual interest rate. <br />The sale price below is based on a target income level established by Health and Safety Code <br />Section 50052.5, not the income of the actual Homebuyer, except in the case of Homebuyers whose <br />income exceeds 110% of area median income. The household size adjustment that is used in <br />determining the income limit for the purpose of setting the maximum Affordable Sales Price is <br />based on the number of bedrooms in the unit, not the size of the specific Homebuyer's household. <br />These criteria are based on the California Health and Safety Code and allow the Affordable Sales <br />Page 79 <br />