Company: BHM
Filing Date: 2025-05-09
Form Type: 424B3
Source: 0001104659-25-046667
Chunk: 5

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-05-09
Form: 424B3
Chunk 5
---
 considered a security under ASC 320 Investments – Debt Securities.

For
investments that meet the criteria of a security under ASC 320 Investments – Debt Securities,
the Company classifies each investment as an available-for-sale (“AFS”) debt security as it does not have the positive intent
to hold all investments to maturity. The Company accounts for these investments as preferred equity investments in its consolidated balance
sheets, and it earns a fixed return on these investments which is included within income from preferred equity investments in its consolidated
statements of operations and comprehensive income. AFS debt securities are carried at fair value in the Company’s consolidated balance
sheets, and any unrealized gains or losses on AFS debt securities are reported as a component of accumulated other comprehensive income
in its consolidated balance sheets, and as a component of other comprehensive income in its consolidated statements of operations and
comprehensive income. The Company evaluates the collectability of each preferred equity investment and estimates a provision for credit
loss, as applicable. Refer to the Current Expected Credit Losses (“CECL”) section of this Note for further information regarding
CECL and the Company’s provision for credit losses.

Prior
to the fourth quarter 2024, the Company classified its preferred equity investments as held-to-maturity debt securities as the investments
met the criteria of a security under ASC 320 Investments – Debt Securities. As of March 31, 2025,
the Company does not have the positive intent to hold all the securities to maturity. As such, the Company has reclassified all its previously
held-to-maturity debt securities to AFS debt securities.

For
investments that do not meet the criteria of a security under ASC 320 Investments – Debt Securities,
the Company has concluded that the characteristics and the facts and circumstances indicate that loan accounting treatment is appropriate.
The Company recognizes interest income on its notes receivable on the accrual method unless a significant uncertainty of collection exists.
If a significant uncertainty exists, interest income is recognized as collected. Costs incurred to originate its notes receivable are
deferred and amortized using the effective interest method over the term of the related note receivable. The Company evaluates the collectability
of each loan investment and estimates a provision for credit loss, as applicable. Refer to the CECL section of this Note for further information
regarding CECL and the Company’s provision for credit losses.

<div align='center'>9</div>

Table of Contents

Income Taxes

For
the three months ended March 31, 2025,