Issue with selling home and upcoming PCS

There going to be a lot of back story to this so please bear with me as I try to be brief its a very complicated situation.

Purchased our home in California back in FEB2022 and we are getting ready to sell here soon with our upcoming PCS in FEB2025, I would have started this process months ago but was on deployment and the home needed some things to get it ready for market.

We purchased our home knowing there were limits to income that we had to get past in order to qualify for the program established by the City Housing Authority, and we just squeaked in with our debt to income being an issue for the Housing Authority. We had already secured a zero down VA loan and we purchased the house for $615,000.

When we originally purchased the home we didn't know how the resale of the home was going to go but we had plans to stay in the area for my shore tour so we didn't have any plans to move or sell in the near future but I made rank again and billets were VERY limited, so much that I almost ended up with 5 looks for orders. After some thinking and deliberation we concluded that our real-estate agent was just chasing a sale when they didn't disclose any of the information about this moderate income limited housing tract so we got a new agent and we are working towards getting it sold.

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When we went to get ready to sell and we used our real-estate agent when we purchased the home as well, when our agent spoke to the housing authority on the matter the housing authority had informed our agent that we could only sell the home for around $570,000 because they base the sell price on 2 primary factors:

1. The median income for the city published by the HUD
2. The current interests rates that are within the market based off of their baseline for their capture for the year, which they did in May of 2024 and they had that variable at 6.6%

We inquired further about this issue and we checked all governing documents and the program guidelines are based out of our CC&R's (Which haven't been reviewed since 1998) that we had one protection clause that stated we can sell the home for only the price that we bought it for at $615,000. The reason this is an issue is one the home is well worth more than what we bought it for back in 2022 and based off of our current principle on our mortgage we are slated to lose about $10,000 to $15,000 in the costs associated with the sale of the home, specifically the compensation of our agent and a buyers agent if we decide to compensate the buyers agent. I am also aware of the new laws associated with the compensation of real-estate agents and that they are negotiable now.

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The issue that we are facing when going to market as well is that the income limits that they set are going to prevent the grand majority of buyers from qualifying with our current $615,000 price tag, they break down the income limits based on household size and use that to get a max limit on income and I ran some numbers based off their limits and this is essentially what I have:

(All of my calculations are based on the income limits of the Housing Authority while assuming a $100,000 down payment and using the approximate 7% interest rate used to calculate the affordable home purchase price from 6.6% and rounded up for current market rates and assuming these buyers also have no other debt, these calculations also include the HOA fees and the Housing Authority income limits do not.)

I used Zillow's affordability calculator

*All numbers rounded to nearest $10,000*

1 person: $370,000

2 person: $425,000

3 person: $480,000

4 person: $500,000

5 person: $550,000

6 person: $590,000

7 person: $630,000

So in the range we are limited to only buyers in the non-loan assumption sale at $615,000 that have a 7 or more person household to even make DTI and they have to have a down payment of $100,000 so our available market of buyers is limited by huge margins unless buyers can bring in well over $100,000 to the table

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We had also talked to both the City and the Housing Authority if there is some wiggle room if we decide to pursue a VA Loan assumption as the buyer would benefit by not having to bring more money to the table, fees are lot less, the receive an interest rate about 1/2 of the current market rates and will get the added benefits of the items we added to the house.

Housing authority told us they wont recalculate the income limits based off of our 3.25% interest rate and wouldn't budge from from their 6.6% for the year so we are still stuck in the same situation on the limitation of buyers.

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The housing authority is also not calculating the HOA dues, which is currently at $650/month, when they calculate their income limits so that even further shoots both us and the buyer in the foot when it comes to purchasing this home.

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I have currently contacted legal for our region but I am pulling all the stops out as best as I can as our move is already difficult as it is and with the added stress of getting the home ready to sell and with the possibility of us having to short sale or walk away from the home has been stressing all of us out.

I wanted to reach out to see if anyone possibly knew of anything that would protect someone from a situation like this because as we work with our real-estate agent things are not looking good for the sale of our home at the moment, granted we haven't hit the market yet but my conversations with the city and the housing authority are not giving me a good feeling.

I also understand that I probably should have read everything before buying, we should have delved more into it and educated ourselves more when buying this home and its a lesson learned for us first time home buyers.