Program Summary

All cities require that their affordable ownership homes have long term sale restrictions that are enforced through the Resale Covenant.  The summary explains major provisions in the ARCH Resale Covenant which is signed by owners at closing and recorded through King County Records.  Each city has their own covenant, which can have slightly different provisions.  So when thinking about purchasing a home, please contact ARCH’s office about specific details for that home.

The ARCH Ownership Housing Program is restricted priced homes located in market-rate housing developments.  The pricing and sale of these home are governed by a Covenant Restricting Resale and Option to Purchase (“Resale Covenant”).  Each city has their own covenant, which can have slightly different provisions.  So when thinking about purchasing a home, please contact ARCH’s office about specific details for that home.

Program Features

  • Home prices range from $150,000 to $400,000, depending on home size and other factors.
  • Homes are located in Bellevue, Redmond, Kirkland, Issaquah, Woodinville, and unincorporated King County.
  • Homes are offered in a variety of styles:  condominiums, townhomes, duplexes, cottages, and single family homes, but are primarily condominiums.
Owners have all the same obligations/rights required by their Homeowner's Association.

Resale Covenant Summary

The Resale Covenant is signed by buyers at closing and recorded through King County Records.  Each community has its own resale covenant with terms ranging from 15 to 50 years from the date of the original sale, with most being 30 years.  The list below includes conditions that are included in all of the resale covenants.  Since each community has its own resale covenant, buyers are highly encouraged to review the  covenant specific to the home they are interested in purchasing (the homeowner should have a copy of their specific resale covenant, but you can also contact ARCH). 

ARCH staff are available to help you with any questions you have about the purchase or sale process of  ARCH Ownership Homes

Resale Covenant: Key Provisions

Below is a list of key provisions included in the Covenant Restricting Resale and Option to Purchase (“Resale Covenant”).  This is only a summary and potential homebuyers are encouraged to read the complete document for the specific home they are interested in purchasing..

  • Homes must be owner-occupied.  (Resale Covenant Section 1.1)
  • The owner shall not rent or lease the property (Resale Covenant Section 1.2 and Section 8.3).  In limited hardship cases, ARCH or the City can approve leasing of a home for short periods of time (typically one year).  These are usually reasons such as family illness, short term employment transfers, etc.

  • Future resale prices are the lower of market value or a resale value set by a formula based on the original sales price plus index appreciation.  The appreciation index for each development is fixed.  Currently, all homes are re-priced annually based on one of several indexes; CPI (Consumer Price Index-housing), REI Seattle/Everett Real Estate Report (Mean Sales of Eastside Cities), HUD Seattle/King County Median Income,  the average of the REI Report and HUD Median Income or on a fixed amount calculated quarterly.  (Resale Covenant Section 4.2.1)

  • First priority for future buyers are households with incomes at or below appropriate income guidelines.  (Resale Covenant Section 1.4)
  • When an owner wishes to sell, for a set period of time (60 - 90 days), there are restrictions on the income of the buyer.  After the initial period, the buyer does not have to meet the household income and size guidelines.  However, the maximum sales price remains unchanged, and the County must still approve the sale.  Buyer must sign and record an assumption agreement at the time of purchase.  (Resale Covenant Section 3.3 and Section 3.6)
  • If a lender assumes a mortgage due to default, the resale control agreement is subordinate to the interests of the lender, so long as the amount of the loan is less than the affordable resale price.  (Resale Covenant Section 11.1 and 11.2)

  • Future resale prices may be increased if significant home improvements have been made.  There are limitations regarding what types of improvements that can result in an increase to future resale prices.  Therefore, it is suggested that the owner contact ARCH prior to making any improvements to determine if they will impact future sales price.  For many of the cities, their Resale Covenant now requires that ARCH preapprove any improvements that will impact future sales price.  (Note: Homeowners are always allowed to make improvements to their home and to do so without approval by ARCH or a City.  However, if an improvement is to impact the future sales price, it must follow the requirements of the Resale Covenant).  Deferred maintenance can also cause future sale price to be reduced.  (Resale Covenant Section 4.2.2)
  • While the Resale Covenant includes a right of first refusal by the City or County, when homeowners are selling their home they are not restricted from doing their own marketing and are encouraged to do so. 
  • After the Resale Covenant expires, the homeowner is allowed to sell the home at market value and to any interested buyer.  However, the homeowner will only receive the same amount of sale proceeds as if the home had been sold at the affordable formula price.  Any difference between the actual sales price and the formula price is returned to the local government for other affordable housing programs.

INCOME GUIDELINES

During the initial marketing period, maximum income levels are established for buyers.  Typically each development will establish a maximum income for buyers somewhere between 80% and 100% of median income, though there are a few homes targeted for families earning as low as 50% of median income.  In addition, maximum income guidelines are often adjusted for both household and unit size. A few of the more common maximum incomes for different incomes and unit sizes are listed in the chart below.

Number of Bedrooms

Number of People in Household

80% of Median Income

100% of Median Income

Two Bedrooms

One to Three People
Four People

$63,504
$70,560

$79,380
$88,200

Three Bedrooms

Two to Four People
Five People
Six People

$70,560
$76,205
$81,850

$88,200
$95,256
$102,312

2014 Guidelines.  Income limits updated annually.