Company: BHM
Filing Date: 2025-07-08
Form Type: DRS
Source: 0001104659-25-066400
Chunk: 34

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-07-08
Form: DRS
Chunk 34
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 and we may not be able to adapt our cost structure to offset declines in our revenue.

Many of the expenses associated
with our business, such as property taxes, HOA fees, insurance, utilities, acquisition, renovation and maintenance costs, and other general
corporate expenses are relatively inflexible and will not necessarily decrease with a reduction in revenue from our business. Some components
of our fixed assets depreciate more rapidly and require ongoing capital expenditures. Our expenses and ongoing capital expenditures are
also affected by inflationary increases, and certain of our cost increases may exceed the rate of inflation in any given period or market.
Our rental income is affected by many factors beyond our control, such as the availability of alternative rental housing and economic
conditions in our markets. In addition, state and local regulations may require us to maintain properties that we own, even if the cost
of maintenance is greater than the value of the property or any potential benefit from renting the property, or pass regulations that
limit our ability to increase rental rates. As a result, we may not be able to fully offset rising costs and capital spending by increasing
rental rates, which could have a material adverse effect on our results of operations and cash available for distribution.

Legislative or other actions affecting the single-family residential housing industry could have a negative effect on our business and financial results.

Various legislative and regulatory
bodies have been focused on the shortage and increases in the cost of residential housing in the U.S. There has been vigorous and continuing
political debate and discussion, in which we participate, with respect to residential housing laws and regulations, with particular focus
on the single-family residential housing industry. Since late 2023, legislation has been introduced that could, if enacted, discourage
or deter the purchase of single-family properties by entities owned or controlled by institutional investors. It is unclear whether these
or similar changes will be enacted and, if enacted, how soon any such changes could take effect. If enacted, such changes could have
an adverse impact on our business and financial results. In addition, there can be no assurance that any other future legislative or
regulatory changes will not be proposed or enacted that could adversely affect our business and financial results.

A significant number of our residential properties are part of HOAs and we and our residents are subject to the rules and regulations of such HOAs, which are subject to change and which may be arbitrary or restrictive, and violations of such rules may subject us to additional fees and penalties and litigation with such HOAs,