Company: BHM
Filing Date: 2025-07-08
Form Type: DRS
Source: 0001104659-25-066400
Chunk: 348

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-07-08
Form: DRS
Chunk 348
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) the average annual percentage of properties sold by the REIT compared to all the REIT’s properties (measured by adjusted bases) in the current and two prior years did not exceed 10% or (5) (i) the aggregate fair market value of all such property sold by the REIT during the year did not exceed 20% of the aggregate fair market value of all property of the REIT at the beginning of the year and (ii) the average annual percentage of properties sold by the REIT compared to all the REIT’s properties (measured by fair market value) in the current and two prior years did not exceed 10%; |

| · | in the case of property consisting of land or improvements (except for property acquired through foreclosure or lease termination), the REIT has held the property for at least two years for the production of rental income; and |

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| · | if the REIT has made more than seven sales of non-foreclosure property during the taxable year, substantially all of the marketing and development expenditures with respect to the property were made through an independent contractor from whom the REIT derives no income or a TRS. |

We will attempt to comply
with the terms of the safe-harbor provisions in the U.S. federal income tax laws prescribing when a property sale will not be characterized
as a prohibited transaction. We cannot assure you, however, that we can comply with the safe-harbor provisions or that we will avoid owning
property that may be characterized as property that we hold “primarily for sale to customers in the ordinary course of a trade or
business.” The 100% tax will not apply to gains from the sale of property that is held through a TRS or other taxable corporation,
although such income will be taxed to the corporation at regular U.S. federal corporate income tax rates.

Recordkeeping Requirements

We must maintain certain records
in order to maintain our qualification as a REIT. In addition, to avoid a monetary penalty, we must request on an annual basis information
from our stockholders designed to disclose the actual ownership of our outstanding stock. We intend to comply with these requirements.

Failure to Qualify

If we fail to satisfy one
or more requirements for REIT qualification, other than the gross income tests and the asset tests, we could avoid disqualification if
our failure is due to reasonable cause and not to willful neglect and we pay a penalty of $50,000 for each such failure