(1) As used in this section:
(a) "Affordable housing" means a dwelling:
(i) offered for sale to an owner-occupier at a purchase price affordable to a household with a gross income of no more than 120% of area median income for the county in which the residential unit is offered for sale; or
(ii) offered for rent at a rental price affordable to a household with a gross income of no more than 80% of area median income for the county in which the residential unit is offered for rent.
(b) "Owner-occupier" means an individual who owns, solely or jointly, a housing unit in which the individual lives as the individual's primary residence.
(c) "Qualifying affordable home ownership single-family density bonus" means:
(i) for an area with an underlying zoning density of less than six residential units per acre, municipal approval of a density at least six residential units per acre; or
(ii) for an area with an underlying zoning density of six residential units per acre or more, municipal approval of a density at least 0.5 residential units per acre greater than the underlying zoning density for the area.
(2) If a municipality approves a qualifying affordable home ownership single-family density bonus, either through a zoning ordinance or a development agreement, the municipality may adopt requirements for the qualifying affordable home ownership single-family density bonus area to ensure:
(a) at least 60% of the total single-family residential units be deed-restricted to owner-occupancy for at least five years;
(b) at least 25% of the total single-family residential units qualify as affordable housing;
(c) at least 25% of the single-family residential units per acre to be no larger than 1,600 square feet; or
(d) the applicant creates a preferential qualifying buyer program in which a single-family residential unit is initially offered for sale, for up to 30 days, to a category of preferred qualifying buyers established by the municipality, in accordance with provisions of the Fair Housing Act, 42 U.S.C. Sec. 3601.
(3) A municipality may offer additional incentives in a qualifying affordable home ownership single-family density bonus area approved for single-family residential units to promote owner-occupied, affordable housing.