Company: BHM
Filing Date: 2025-04-07
Form Type: POS AM
Source: 0001104659-25-032524
Chunk: 153

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-04-07
Form: POS AM
Chunk 153
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 the investments met the criteria of a security under ASC 320
Investments – Debt Securities. As of December 31, 2024, we do not have the positive intent to hold all the securities
to maturity. As such, we have reclassified all our 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, we have concluded that the characteristics
and the facts and circumstances indicate that loan accounting treatment is appropriate. We recognize interest income on our 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 our notes receivable are deferred and amortized using the effective interest method
over the term of the related note receivable. We evaluate the collectability of each loan investment and estimate a provision for credit
loss, as applicable.

Real Estate Assets

Real Estate Purchase Price Allocations

Upon acquisition, we evaluate our acquired residential properties for purposes of determining whether a transaction should be accounted for as an asset acquisition or business combination.Purchases of residential properties are treated as asset acquisitions and, as
such, are recorded at their purchase price, including acquisition costs, which is allocated to land and building based upon their relative
fair values at the date of acquisition. Acquisition costs typically include legal fees, broker commissions and title fees, as well as
other closing costs. In making estimates of fair values for purposes of allocating the purchase price of acquired properties, we utilize
various sources including our own market knowledge obtained from historical transactions, published market data, and independent appraisers.
In this regard, we also utilize information obtained from county tax assessment records to assist in the determination of the fair value
of the land and building.

Intangible assets include
the value of in-place leases which represents the estimated fair value of the net cash flows of leases in place at the time of acquisition,
as compared to the net cash flows that would have occurred had the property been vacant at the time of acquisition and subject to lease-up.
We amortize the value of in-place leases to expense over the remaining non-cancelable term of the respective leases, which is on average
six months.

Estimates of the fair values of the tangible assets, identifiable intangibles and assumed liabilities require us to make significant assumptions to estimate market lease rates, property operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods,