The City of Palo Alto has adopted a program for the sale of some homes at a price below fair market value following policies contained in the Housing Element of the City Comprehensive Plan and in the City’s Below Market Rate Housing Program Ordinance (Chapter 18.14 of the Palo Alto Municipal Code).

In exchange for providing some low and moderate income households with the opportunity to purchase a home at an affordable price, the City requires the homebuyers to agree to certain conditions, including these major provisions:

• You live in your home as your principal place of residence for at least ten (10) months a year.  You are prohibited from renting out your home without the City’s express written consent.
• A resale agreement places controls on the sale of your home.  There is a limit to the price at which you can sell your home.  In addition, you must follow certain steps and procedures when you decide to sell the home.
• The City has an option to purchase your home at a restricted price when you put the home up for sale or if you default on the Resale Agreement.  If you sell your home for an amount above the restricted price, the City has a right to any proceeds greater than the restricted price.
• The Resale Agreement has a term of fifty-nine (59) years.