UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2014

OR

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from  to

Commission file number 000-54674

STEADFAST INCOME REIT, INC.

(Exact Name of Registrant as Specified in Its Charter)

Maryland	27-0351641
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)
18100 Von Karman Avenue, Suite 500
Irvine, California	92612
(Address of Principal Executive Offices)	(Zip Code)

(949) 852-0700

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $0.01 par value per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No þ

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated filer o	Accelerated filer o	Non-Accelerated filer þ	Smaller reporting company o
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

There is no established market for the registrant’s shares of common stock. The registrant conducted an ongoing initial public offering of its shares of common stock pursuant to a Registration Statement on Form S-11, which shares were sold at $10.24 per share, with discounts available for certain categories of purchasers. The registrant terminated its ongoing initial public offering on December 20, 2013. There were approximately 74,978,722 shares of common stock held by non-affiliates at June 30, 2014, the last business day of the registrant’s most recently completed second fiscal quarter.

As of March 10, 2015, there were 76,858,483 shares of the Registrant’s common stock issued and outstanding.

STEADFAST INCOME REIT, INC.

INDEX

		Page
Cautionary Note Regarding Forward-Looking Statements		i
PART I
Item 1.	Business	1
Item 1A.	Risk Factors	9
Item 1B.	Unresolved Staff Comments	32
Item 2.	Properties	33
Item 3.	Legal Proceedings	33
Item 4.	Mine Safety Disclosures	33
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	33
Item 6.	Selected Financial Data	41
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	43
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	70
Item 8.	Financial Statements and Supplementary Data	70
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	70
Item 9A.	Controls and Procedures	71
Item 9B.	Other Information	71
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	72
Item 11.	Executive Compensation	77
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	78
Item 13.	Certain Relationships and Related Transactions, and Director Independence	79
Item 14.	Principal Accountant Fees and Services	84
PART IV
Item 15.	Exhibits and Financial Statement Schedules	85
	Index to Consolidated Financial Statements

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements of Steadfast Income REIT, Inc. (“we,” “our,” “us” or the “Company”) included in this annual report on Form 10-K that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are only predictions. We caution that forward-looking statements are not guarantees. Actual events or our investments and results of operations could differ materially from those expressed or implied in any forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of such terms and other comparable terminology.

The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. Factors that could have a material adverse effect on our operations and future prospects include, but are not limited to:

• the fact that we have had a net loss for each quarterly and annual period since inception;

• changes in economic conditions generally and the real estate and debt markets specifically;

• our ability to secure resident leases at favorable rental rates;

• our ability to execute on our value-enhancement strategy;

• risks inherent in the real estate business, including tenant defaults, potential liability relating to environmental matters and the lack of liquidity of real estate investments;

• the fact we pay fees and expenses to our advisor and its affiliates that were not negotiated on an arm’s length basis and the fact that the payment of these fees and expenses increases the risk that our stockholders will not earn a profit on their investment in us;

• our ability to retain our executive officers and other key personnel of our advisor, our property manager and our affiliates;

• legislative or regulatory changes (including changes to the laws governing the taxation of real estate investment trusts, or REITs);

• our ability to generate sufficient cash flows to pay distributions to our stockholders;

• the availability of capital;

• the fact that we have a limited operating history, having commenced operations on August 11, 2010;

• changes in interest rates; and

• changes to generally accepted accounting principles, or GAAP.

Any of the assumptions underlying forward-looking statements could be inaccurate. You are cautioned not to place undue reliance on any forward-looking statements included in this annual report. All forward-looking statements are made as of the date of this annual report and the risk that actual results will differ materially from the expectations expressed in this annual report will increase with the passage of time. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this annual report, whether as a result of new information, future events, changed circumstances or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this annual report, including, without limitation, the risks described under “Risk Factors,” the inclusion of such forward-looking statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this annual report will be achieved.

i

PART I

ITEM 1. BUSINESS

Overview

Steadfast Income REIT, Inc. (which is referred to in this annual report, as the context requires, as the “Company,” “we,” “us” or “our”) was formed on May 4, 2009, as a Maryland corporation that has elected to qualify as a real estate investment trust, or REIT. We invest in and manage a diverse portfolio of real estate investments, primarily in the multifamily sector, located throughout the United States. Substantially all of our business is conducted through Steadfast Income REIT Operating Partnership, L.P., a Delaware limited partnership formed on July 6, 2009, which we refer to as our “operating partnership.” We are the sole general partner of our operating partnership. As of December 31, 2014, we owned 65 multifamily properties comprised of a total of 16,526 apartment homes and 25,973 square feet of rentable commercial space. For more information on our real estate portfolio, see “—Our Real Estate Portfolio” below.

On July 19, 2010, we commenced our initial public offering of up to 150,000,000 shares of common stock at an initial price of $10.00 per share (subject to certain discounts) and up to 15,789,474 shares of common stock pursuant to our distribution reinvestment plan at an initial price of $9.50 per share. On July 12, 2012, our board of directors determined an estimated value per share of our common stock of $10.24 as of March 31, 2012. As a result of the determination of the estimated value per share of our common stock as of March 31, 2012, effective September 10, 2012, the offering price of our common stock in our public offering increased from the initial price of $10.00 per share to $10.24 per share. Additionally, effective September 10, 2012, the price of shares of our common stock issued pursuant to the distribution reinvestment plan increased from the initial price of $9.50 per share to a price of $9.73 per share, or 95% of the new public offering price of $10.24 per share.

On December 20, 2013, we terminated our initial public offering. Upon termination of our initial public offering, we had sold 73,608,337 shares of common stock for gross offering proceeds of $745,389,748, including 1,588,289 shares of common stock issued pursuant to our distribution reinvestment plan for gross offering proceeds of $15,397,232. Following the termination of our initial public offering, we continued to offer shares of our common stock pursuant to our distribution reinvestment plan until our board of directors determined to suspend our distribution reinvestment plan effective November 20, 2014.

Prior to the commencement of our public offering, we sold shares of our common stock in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended, or the Securities Act. Upon termination of the private offering, we had sold 637,279 shares of common stock at $9.40 per share (subject to certain discounts) for net offering proceeds of $5,844,325.

We are externally managed by Steadfast Income Advisor, LLC, which we refer to as our “advisor,” pursuant to the Advisory Agreement, as amended, or the advisory agreement, by and among us, our operating partnership and our advisor. Subject to certain restrictions and limitations, our advisor manages our day-to-day operations and our portfolio of properties and real estate-related assets. Our advisor sources and presents investment opportunities to our board of directors and provides investment management services on our behalf. We retained Steadfast Capital Markets Group, LLC, or the dealer manager, our affiliate, to serve as the dealer manager for our initial public offering. The dealer manager was responsible for marketing our shares of common stock being offered pursuant to our initial public offering. The advisor, along with the dealer manager, also provides marketing, investor relations and other administrative services on our behalf.

1

Our Structure

The chart below shows the relationships among our company and various affiliates.

2

Objectives and Strategies

Our primary investment objectives are to:

• preserve, protect and return invested capital;

• pay attractive and stable cash distributions to stockholders; and

• realize capital appreciation in the value of our investments over the long term.

We intend to use the cash flows from our operations to continue to invest in our real estate investments located throughout the United States. We have acquired, and actively manage, stabilized and income-producing properties with the objective of providing a stable and secure source of income for our stockholders and maximizing potential returns upon disposition of our assets through capital appreciation. We may make these investments directly or through joint ventures, in each case provided that the underlying real estate or real estate-related asset generally meets our criteria for direct investment.

2014 Highlights

During 2014, we:

• acquired seven multifamily properties for an aggregate purchase price of $130,339,157, exclusive of closing costs, increasing our property portfolio to 65 multifamily properties with an aggregate purchase price of $1,624,892,557;

• paid cash distributions of $29,491,989 and distributed $24,183,672 in shares of our common stock pursuant to our distribution reinvestment plan, which together constituted a 7.0% annualized distribution to our stockholders;

• sold three multifamily properties for a gross sales price of $30,912,500, recognizing a gain on sales of real estate of $9,944,134;

• generated cash flows from operations of $48,556,847;

• generated net operating income of $101,332,546;

• generated funds from operations of $33,994,751 (for further information on how we calculate funds from operations and a reconciliation of funds from operations to net loss, please refer to Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Funds From Operations and Modified Funds From Operations”);

• generated modified funds from operations of $45,002,936 (for further information on how we calculate modified funds from operations and a reconciliation of modified funds from operations to net loss, please refer to Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Funds From Operations and Modified Funds From Operations”); and

• generated a net loss of $25,742,292.

Evaluation of Strategic Alternatives

On October 21, 2014, we announced that we had retained an investment banker as our financial advisor to assist in evaluating strategic alternatives for a potential liquidity event. Our board of directors completed a thorough review of the strategic alternatives available to us, and on March 10, 2015, concluded the engagement with our investment banker, subject to the terms of our engagement letter. Our board of directors determined that given that a substantial portion of our apartment communities were acquired during and after the final four months of our offering period, and as we are continuing to execute on their operational phase, it is in the best interests of our stockholders to continue to execute our business plan through the continuation of our targeted renovations and introduction of property-level operational initiatives to increase property values. We expect to continue to have dialogue with investment bankers and use them as a valuable resource as we continue with the operational phase of our business plan, which we believe will maximize our ability to position the portfolio for an optimal exit for our stockholders.

3

Our Real Estate Portfolio

As of December 31, 2014, we owned the 65 multifamily properties described below.

	Property Name	City and State	Number of Units	Average Monthly Occupancy(1)		Average Monthly Rent(2)		Purchase Date	Contract Purchase Price		Mortgage Debt Outstanding
1	Park Place Condominiums	Des Moines, IA	151	86.1	%	$	813	12/22/2010	$	8,323,400	$	4,890,069
2	Clarion Park Apartments(3)	Olathe, KS	220	97.7	%	753		6/28/2011	11,215,000		8,479,259
3	Cooper Creek Village	Louisville, KY	123	94.3	%	913		8/24/2011	10,420,000		6,500,887
4	Truman Farm Villas(4)	Grandview, MO	200	98.0	%	679		12/22/2011	9,100,000		5,709,615
5	EBT Lofts	Kansas City, MO	102	95.1	%	924		12/30/2011	8,575,000		5,397,291
6	Windsor on the River	Cedar Rapids, IA	424	94.8	%	686		1/26/2012	33,000,000		23,500,000
7	Renaissance St. Andrews	Louisville, KY	216	97.7	%	658		2/17/2012	12,500,000		8,937,635
8	Spring Creek of Edmond	Edmond, OK	252	96.0	%	847		3/9/2012	19,350,000		13,577,869
9	Montclair Parc Apartments	Oklahoma City, OK	360	96.7	%	866		4/26/2012	35,750,000		23,827,037
10	Sonoma Grande Apartments	Tulsa, OK	336	95.2	%	953		5/24/2012	32,200,000		22,324,719
11	Estancia Apartments	Tulsa, OK	294	95.9	%	961		6/29/2012	27,900,000		21,485,523
12	Montelena Apartments	Round Rock, TX	232	94.8	%	1,003		7/13/2012	18,350,000		12,290,751
13	Valley Farms Apartments	Louisville, KY	160	97.5	%	845		8/30/2012	15,100,000		10,068,528
14	Hilliard Park Apartments	Columbus, OH	201	97.0	%	999		9/11/2012	19,800,000		13,563,481
15	Sycamore Terrace Apartments	Terre Haute, IN	250	94.8	%	1,151		9/20/2012 & 3/5/2014	23,174,157		—
16	Hilliard Summit Apartments	Columbus, OH	208	90.9	%	1,080		9/28/2012	24,100,000		16,436,620
17	Springmarc Apartments	San Marcos, TX	240	92.5	%	878		10/19/2012	21,850,000		15,166,129
18	Renaissance at St. Andrews Condominiums	Louisville, KY	29	96.6	%	650		10/31/2012	1,375,000		—
19	Ashley Oaks Apartments	San Antonio, TX	462	93.3	%	756		11/29/2012	30,790,000		21,296,125
20	Arrowhead Apartments	Palatine, IL	200	97.5	%	1,027		11/30/2012	16,750,000		12,321,880
21	The Moorings Apartments	Roselle, IL	216	95.4	%	1,022		11/30/2012	20,250,000		14,896,178
22	Forty-57 Apartments	Lexington, KY	436	95.0	%	836		12/20/2012	52,500,000		38,500,000
23	Keystone Farms Apartments	Nashville, TN	90	98.9	%	1,044		12/28/2012	8,400,000		6,100,287
24	Riverford Crossing Apartments	Frankfort, KY	300	96.7	%	803		12/28/2012	30,000,000		21,900,000
25	South Pointe at Valley Farms(5)	Louisville, KY	32	93.8	%	992		12/28/2012	5,275,000		1,155,185

4

	Property Name	City and State	Number of Units	Average Monthly Occupancy(1)		Average Monthly Rent(1)		Purchase Date	Contract Purchase Price		Mortgage Debt Outstanding
26	Montecito Apartments	Austin, TX	268	95.9	%	$	855	12/31/2012	$	19,000,000	$	14,003,890
27	Hilliard Grand Apartments	Dublin, OH	314	96.8	%	1,217		12/31/2012	40,500,000		28,832,151
28	The Hills at Fair Oaks	Fair Oaks Ranch, TX	288	95.8	%	975		1/31/2013	34,560,000		24,767,000
29	Library Lofts East(6)	Kansas City, MO	118	98.3	%	955		2/28/2013	12,750,000		8,941,943
30	The Trails at Buda Ranch	Buda, TX	264	95.1	%	999		3/28/2013	23,000,000		16,821,368
31	Deep Deuce at Bricktown	Oklahoma City, OK	294	95.2	%	1,296		3/28/2013	38,220,000		26,639,205
32	Deer Valley Apartments	Lake Bluff, IL	224	96.4	%	1,270		4/30/2013	28,600,000		20,645,873
33	Grayson Ridge	North Richland Hills, TX	240	92.9	%	750		5/31/2013	14,300,000		10,631,586
34	Rosemont at Olmos Park	San Antonio, TX	144	93.1	%	1,239		5/31/2013	22,050,000		14,667,462
35	Retreat at Quail North	Oklahoma City, OK	240	97.5	%	956		6/12/2013	25,250,000		17,029,692
36	The Lodge at Trails Edge	Indianapolis, IN	268	95.5	%	708		6/18/2013	18,400,000		12,657,096
37	Arbors at Carrollton	Carrollton, TX	131	96.9	%	824		7/3/2013	8,800,000		6,261,078
38	Waterford on the Meadow	Plano, TX	350	93.1	%	843		7/3/2013	23,100,000		16,603,668
39	The Belmont	Grand Prairie, TX	260	96.9	%	736		7/26/2013	12,100,000		9,295,899
40	Meritage at Steiner Ranch(7)	Austin, TX	502	92.6	%	1,342		8/6/2013	80,000,000		55,198,913
41	Tapestry Park Apartments	Birmingham, AL	354	63.6	%	1,196		8/13/2013 & 12/1/2014	50,285,000		34,725,000
42	Dawntree Apartments	Carrollton, TX	400	94.5	%	773		8/15/2013	24,000,000		15,833,312
43	Stuart Hall Lofts(8)	Kansas City, MO	115	93.0	%	1,213		8/27/2013	16,850,000		12,350,045
44	BriceGrove Park Apartments	Canal Winchester, OH	240	92.9	%	813		8/29/2013	20,100,000		14,932,281
45	Retreat at Hamburg Place	Lexington, KY	150	95.3	%	932		9/5/2013	16,300,000		—
46	Cantare at Indian Lake Village	Hendersonville, TN	206	95.1	%	1,070		9/24/2013	29,000,000		18,850,000
47	Landing at Mansfield	Mansfield, TX	336	93.2	%	918		9/27/2013	30,900,000		22,671,543
48	The Heights Apartments	Houston, TX	504	93.1	%	929		9/30/2013	37,000,000		28,912,294
49	Villas at Huffmeister	Houston, TX	294	96.3	%	1,137		10/10/2013	37,600,000		25,917,180
50	Villas at Kingwood	Kingwood, TX	330	95.8	%	1,168		10/10/2013	40,150,000		28,055,400
51	Waterford Place at Riata Ranch	Cypress, TX	228	96.9	%	1,075		10/10/2013	23,400,000		16,310,966
52	Carrington Place	Houston, TX	324	94.1	%	998		11/7/2013	32,900,000		22,376,000

5

	Property Name	City and State	Number of Units	Average Monthly Occupancy(1)		Average Monthly Rent(1)		Purchase Date	Contract Purchase Price		Mortgage Debt Outstanding
53	Carrington at Champion Forest	Houston, TX	284	96.8	%	$	1,051	11/7/2013	$	33,000,000	$	22,959,000
54	Carrington Park	Cypress, TX	232	93.1	%	1,045		11/7/2013	25,150,000		17,717,000
55	Willow Crossing	Elk Grove, IL	579	92.4	%	974		11/20/2013	58,000,000		43,500,000
56	Echo at Katy Ranch	Katy, TX	260	93.1	%	1,328		12/19/2013	35,100,000		—
57	Heritage Grand at Sienna Plantation	Missouri City, TX	240	94.6	%	1,186		12/20/2013	27,000,000		16,697,112
58	Audubon Park	Nashville, TN	256	92.6	%	823		12/27/2013	16,750,000		11,760,000
59	Mallard Crossing	Cincinnati, OH	350	92.0	%	989		12/27/2013	39,800,000		27,860,000
60	Renaissance at Carol Stream	Carol Stream, IL	293	93.5	%	1,000		12/31/2013	29,150,000		20,440,000
61	Reserve at Creekside	Chattanooga, TN	192	94.3	%	909		3/28/2014	18,875,000		—
62	Mapleshade Park	Dallas, TX	148	89.9	%	1,462		3/31/2014	23,325,000		15,161,000
63	Richland Falls(9)	Murfreesboro, TN	190	96.3	%	860		5/16/2014	21,000,000		13,800,000
64	Oak Crossing	Fort Wayne, IN	222	95.9	%	956		6/3/2014	24,230,000		15,762,000
65	Park Shore	St. Charles, IL	160	95.0	%	1,113		9/12/2014	18,350,000		12,845,000
			16,526	94.1	%	$	966		$	1,624,892,557	$	1,070,757,025

________________

(1) At December 31, 2014, our portfolio was approximately 96.6% leased.

(2) Average monthly rent is based upon the effective rental income after considering the effect of vacancies, concessions and write-offs.

(3) 100% of the units are required to be rented to tenants earning no more than 60% of the median income in the local area.

(4) Approximately 74% of the units are required to be rented to tenants earning no more than 60% of the median income in the local area.

(5) South Pointe at Valley Farms includes one clubhouse building/leasing office and improved land that is zoned and entitled for an additional 224 apartment homes. As of December 31, 2014, 96 of the zoned 224 apartment homes are under development.

(6) Library Lofts East contains 16,680 rentable square feet of commercial space. As of December 31, 2014, the commercial space, which represents approximately 14.1% of the rentable square feet of Library Lofts East, was 100.0% occupied by one tenant. The lease term of the tenant occupying the commercial space expires in 2018, subject to tenant extension options. The tenant pays an average annual rent of approximately $187,680, or approximately $11.25 per square foot.

(7) Meritage at Steiner Ranch contains 4,843 rentable square feet of commercial space. As of December 31, 2014, the commercial space, which represents approximately 0.7% of the rentable square feet of Meritage at Steiner Ranch, was 100.0% occupied by one tenant. The lease term of the tenant occupying the commercial space expires in 2021, subject to tenant extension options. The tenant pays an average annual rent of approximately $102,056, or approximately $21.07 per square foot.

6

(8) Stuart Hall Lofts contains 4,450 rentable square feet of commercial space. As of December 31, 2014, the commercial space, which represents approximately 3.1% of the rentable square feet of Stuart Hall Lofts, was 100.0% occupied by one tenant. The lease term of the tenant occupying the commercial space expires in 2019. The tenant pays an average annual rent of approximately $64,524, or approximately $14.50 per square foot.

(9) Richland Falls includes one clubhouse building/leasing office and improved land that is zoned for an additional 86 apartment homes.

At December 31, 2014, our portfolio was approximately 94.1% occupied and the average monthly rent per leased multifamily home in our portfolio was $966. The weighted-average remaining lease term of our portfolio is less than one year. The weighted-average remaining lease term of our commercial office space leases is 4.13 years.

We plan to invest up to $22 million through 2015 for interior renovations at certain properties in our portfolio. These renovations are primarily to enhance the interior amenities of the apartment homes and will be performed initially on vacant units and thereafter on units vacated during the ordinary course of business.

The following information generally applies to all our properties:

• we believe all of our properties are adequately covered by insurance and are suitable for their intended purposes;

• except as noted above, we have no plans for any material renovations, improvements or developments with respect to any of our properties; and

• our properties face competition in attracting new residents and retaining current residents from other multifamily properties in and around their respective submarkets.

Debt Policy

We use, and intend to use in the future, secured and unsecured debt as a means of providing additional funds for the acquisition, development or renovation of our properties and our real estate-related assets. We believe that careful use of debt helps us achieve our diversification goals and potentially enhance the returns on our investments. Our debt was approximately 65% of the aggregate cost of our real properties (before deducting depreciation and amortization) plus the value of our other investments, at the conclusion of our public offering. Going forward, we expect that our debt will be approximately 65% of the value of our properties, as determined by an independent third party appraiser or qualified independent valuation expert. Under our Third Articles of Amendment and Restatement, or our charter, we are prohibited from borrowing in excess of 300% of our net assets, which generally approximates to 75% of the aggregate cost of our assets. We may borrow in excess of this amount if such excess is approved by a majority of the independent directors and disclosed to stockholders in our next quarterly report, along with a justification for such excess. In such event, we will monitor our debt levels and take action to reduce any such excess as soon as practicable. Our aggregate borrowings are reviewed by our board of directors at least quarterly. At December 31, 2014, our borrowings were not in excess of 300% of the value of our net assets.

Employees

We have no paid employees. The employees of our advisor or its affiliates provide management, acquisition, advisory and certain administrative services for us.

Competition

We are subject to significant competition in seeking real estate investments and residents. We compete with many third parties engaged in real estate investment activities, including other REITs, specialty finance companies, savings and loan associations, banks, mortgage bankers, insurance companies, mutual funds, institutional investors, investment banking firms, lenders, hedge funds, governmental bodies and other entities. Many of our competitors have substantially greater financial and other resources than we have and may have substantially more operating experience than us. They also may enjoy significant competitive advantages that result from, among other things, a lower cost of capital.

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We may also compete with Steadfast Apartment REIT, Inc., or Steadfast Apartment REIT, a non-traded REIT sponsored by our sponsor that commenced its ongoing initial public offering in December 2013 and has a similar investment strategy as us. However, we expect any competition with Steadfast Apartment REIT for property acquisitions to be limited as our public offering terminated on December 20, 2013 and we have deployed all of the net offering proceeds raised in our public offering.

The multifamily property market in particular is highly competitive. This competition could reduce occupancy levels and revenues at our multifamily properties, which would adversely affect our operations. We face competition from many sources, including from other multifamily properties both in the immediate vicinity and the geographic market where our multifamily properties are and will be located. In addition, overbuilding of multifamily properties may occur, which would increase the number of multifamily homes available and may decrease occupancy and unit rental rates. Furthermore, multifamily properties we acquire most likely compete, or will compete, with numerous housing alternatives in attracting residents, including owner occupied single and multifamily homes available to rent or purchase. Competitive housing in a particular area and the increasing affordability of owner occupied single- and multi-family homes available to rent or buy (caused by declining mortgage interest rates and government programs to promote home ownership) could adversely affect our ability to retain our residents, lease apartment homes and increase or maintain rental rates.

Regulations

Our investments are subject to various federal, state, and local laws, ordinances, and regulations, including, among other things, zoning regulations, land use controls, environmental controls relating to air and water quality, noise pollution, and indirect environmental impacts such as increased motor vehicle activity. We believe that we have all permits and approvals necessary under current law to operate our investments.

Income Taxes

We have elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code, and have operated as such beginning with the taxable year ended December 31, 2010. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, we generally will not be subject to federal income tax to the extent we distribute qualifying dividends to our stockholders. If we fail to qualify as a REIT in any taxable year after the taxable year in which we initially elected to be taxed as a REIT, we will be subject to federal income tax on our taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants us relief under certain statutory provisions.

Financial Information About Industry Segments

Our current business consists of owning, managing, operating, leasing, acquiring, developing, investing in, and disposing of real estate assets. We internally evaluate all of our real estate assets as one industry segment, and, accordingly, we do not report segment information.

Available Information

We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and, as a result, file periodic reports, proxy statements and other information with the SEC. Access to copies of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and other filings with the SEC, including amendments to such filings, may be obtained free of charge from our website, http://www.steadfastreits.com. These filings are available promptly after we file them with, or furnish them to, the SEC. We are not incorporating our website or any information from the website into this annual report. The SEC also maintains a website, http://www.sec.gov, that contains our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Report on Form 8-K, proxy statements and other filings with the SEC. Access to these filings is free of charge.

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ITEM 1A. RISK FACTORS

The following are some of the risks and uncertainties that could cause our actual results to differ materially from those presented in our forward-looking statements. The risks and uncertainties described below are not the only ones we face but do represent those risks and uncertainties that we believe are material to us. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also harm our business. References to “shares” and “our common stock” refer to the shares of common stock of Steadfast Income REIT, Inc.

General Investment Risks

We have a limited operating history and there is no assurance that we will be able to successfully achieve our investment objectives.

We commenced our operations on August 11, 2010. We, our sponsor and our advisor have a limited operating history and may not be able to successfully operate our business or achieve our investment objectives. As a result, an investment in our shares of common stock may entail more risk than an investment in the shares of common stock of a real estate investment trust with a substantial operating history.

From inception through December 31, 2014, we have experienced annual net losses and may experience similar losses in the future.

From inception through December 31, 2014, we incurred a net loss of $110,394,667. We cannot assure you that we will be profitable in the future or that we will recognize growth in the value of our assets.

There is no public trading market for shares of our common stock and we are not required to effectuate a liquidity event by a certain date. As a result, it will be difficult for you to sell your shares of common stock and, if you are able to sell your shares, you are likely to sell them at a substantial discount.

There is no current public market for the shares of our common stock and we have no obligation to list our shares on any public securities market or provide any other type of liquidity to our stockholders by a particular date. It may therefore be difficult for you to sell your shares of common stock. Even if you are able to sell your shares of common stock, the absence of a public market may cause the price received for any shares of our common stock sold to be less than what you paid or less than your proportionate value of the assets we own. We initially adopted a share repurchase plan that allowed stockholders to sell to us their shares of common stock, subject to certain limitations. However, our share repurchase plan was suspended effective November 20, 2014. There is no assurance as to when we will reinstate our share repurchase plan, if at all. Once reinstated, our board of directors may again in the future, amend, suspend, or terminate our share repurchase plan upon 30 days notice. Additionally, our charter does not require that we consummate a transaction to provide liquidity to stockholders on any date certain. As a result, you must be prepared to hold your shares for an indefinite period of time.

We have paid a significant portion of our distributions to date from the proceeds of our public offering and cannot guarantee in the future that we will pay distributions solely from cash flow from operations. To the extent that we pay distributions from sources other than our cash flow from operations, we will have less funds available for investments, the overall returns to our stockholders may be reduced and subsequent stockholders will experience dilution.

Our organizational documents permit us to pay distributions from any source, including offering proceeds or borrowings (both of which may constitute a return of capital). From inception through the date of this annual report, a significant portion of distributions paid to our stockholders were funded from offering proceeds from our public offering. To the extent we had funded distributions from the net proceeds of our public offering, we had less funds available for investment in real properties and real estate-related assets than if our distributions came solely from cash flow from operations, the overall returns to our stockholders may be reduced and subsequent investors will experience dilution. There is no limit on the amount of distributions we may fund from sources other than from cash flows from operations.

If the aggregate amount of cash we distribute to stockholders in any given year exceeds the amount of our earnings and profits generated during the year, the excess amount will either be (1) a return of capital or (2) a gain from the sale or exchange of property to the extent that a stockholder’s basis in our common stock equals or is reduced to zero as the result of our current or prior year distributions.

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We face risks associated with the acquisition and value-enhancement of properties.

We regularly acquire and renovate existing properties (which we refer to as “value-enhancement projects”). These activities are subject to various risks. We may not be successful in pursuing value-enhancement project opportunities. In addition, completed value-enhancement projects may not perform as well as expected. We are subject to other risks in connection with any acquisition and value-enhancement activities, including the following:

• costs of a project may be higher than projected, potentially making the project unfeasible or unprofitable;

• we may not have funds available or be able to obtain financing for our value-enhancement projects on favorable terms, if at all;

• occupancy rates and rents may not meet our projections and that project may not be profitable.

If a value-enhancement project is unsuccessful, either because it is not meeting our expectations when operational or was not completed according to the value-enhancement project planning, the value of our investment in the project may decrease.

Disruptions in the financial markets and deteriorating economic conditions could adversely impact our ability to implement our investment strategy and achieve our investment objectives.

United States and global financial markets have experienced extreme volatility and disruption in recent years. There has been a widespread tightening in overall credit markets, devaluation of the assets underlying certain financial contracts and increased borrowing by governmental entities. The recent turmoil in the capital markets resulted in constrained equity and debt capital available for investment in the real estate market, resulting in fewer buyers seeking to acquire real properties, increases in capitalization rates and lower property values. Recently, capital has been more available and the overall economy has begun to improve. However, the failure of a sustained economic recovery or future disruptions in the financial markets and deteriorating economic conditions could impact the value of our investments in properties. In addition, if potential purchasers of real properties have difficulty obtaining capital to finance property acquisitions, capitalization rates could increase and property values could decrease. Current economic conditions greatly increase the risks of our investments. See “—Risks Related to Investments in Real Estate.”

Recently enacted and potential financial regulatory reforms could have a significant impact on our business, financial condition and results of operations.

On July 21, 2010, President Barack Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Dodd-Frank Act, into law. The Dodd-Frank Act represents a significant change in the American financial regulatory environment and impacts nearly every aspect of the United States financial services industry. The Dodd-Frank Act requires various federal agencies to adopt hundreds of new rules to implement the Dodd-Frank Act and to deliver to Congress numerous studies and reports that may influence future legislation. The Dodd-Frank Act leaves significant discretion to federal agencies as to exactly how to implement the broad provisions of the Dodd-Frank Act. To date, many of the details and much of the impact of the Dodd-Frank Act is not known, and may not be known for some time. The changes resulting from the Dodd-Frank Act may impact the profitability of business activities, require changes to certain business practices, impose more stringent capital, liquidity and leverage requirements or otherwise adversely affect our business.

Further, we may be required to invest significant management attention and resources to evaluate and make any changes necessary to comply with new statutory and regulatory requirements under the Dodd-Frank Act, which may negatively impact results of operations and our financial condition.

The geographic concentration of our portfolio may make us particularly susceptible to adverse economic developments in the real estate markets of those areas.

In addition to general, regional and national economic conditions, our operating results are impacted by the economic conditions of the specific markets in which we have concentrations of properties. As of December 31, 2014, of our $1,624,892,557 of real estate assets, 41.7% was located in Texas, including 17.9% located in the Houston metropolitan area, 10.0% located in the Austin metropolitan area, 8.4% located in the Dallas/Fort Worth metropolitan area and 5.4% located in the San Antonio metropolitan area. Additionally, 10.5% of of our real estate assets were located in the Chicago metropolitan area. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors, or any decrease in demand for multifamily

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property space resulting from the local business climate, could adversely affect our property revenue, and hence net operating income.

Non-traded REITs have been the subject of increased scrutiny by regulators and media outlets resulting from inquiries and investigations initiated by FINRA and the SEC. We could also become the subject of scrutiny and may face difficulties in raising capital should negative perceptions develop regarding non-traded REITs. As a result, we may be unable to raise substantial funds which will limit the number and type of investments we may make and our ability to diversify our assets.

Our securities, like other non-traded REITs, were sold through the independent broker-dealer channel (i.e., U.S. broker-dealers that are not affiliated with money center banks or similar financial institutions). Governmental and self-regulatory organizations like the SEC and FINRA impose and enforce regulations on broker-dealers, investment banking firms, investment advisers and similar financial services companies. Self-regulatory organizations such as FINRA adopt rules, subject to approval by the SEC, that govern aspects of the financial services industry and conduct periodic examinations of the operations of registered investment dealers and broker-dealers.

Recently, FINRA has initiated investigations of broker-dealers with respect to the sales practices related to the sale of shares of non-traded REITS. These proceedings have resulted in increased regulatory scrutiny from the SEC regarding non-traded REITs. As a result of this increased scrutiny and accompanying negative publicity and coverage by media outlets, FINRA may impose additional restrictions on sales practices in the independent broker-dealer channel for non-traded REITs, and accordingly we may face increased difficulties in raising capital in the future. This could result in a reduction in the returns achieved on those investments as a result of a smaller capital base limiting our investments. If we become the subject of scrutiny, even if we have complied with all applicable laws and regulations, responding to such scrutiny could be expensive and distracting our management.

FINRA has also recently adopted changes to rules relating to information required to be included on customer account statements by registered broker dealers. In order to assist broker dealers in complying with the new rules, we are required to obtain independent valuations of our assets to determine an estimated per share value of our common stock more frequently than under prior regulations. Compliance with these new rules and future rule changes by FINRA could increase our operating expenses which could have an adverse effect on our results of operations.

A cybersecurity incident and other technology disruptions could negatively impact our business.

We use technology in substantially all aspects of our business operations. We also use mobile devices, social networking, outside vendors and other online activities to connect with our residents, suppliers and employees of our affiliates. Such uses give rise to potential cybersecurity risks, including security breach, espionage, system disruption, theft and inadvertent release of information. Our business involves the storage and transmission of numerous classes of sensitive and confidential information and intellectual property, including residents’ and suppliers’ personal information, private information about employees, and financial and strategic information about us. If we fail to assess and identify cybersecurity risks associated with our operations, we may become increasingly vulnerable to such risks. Additionally, the measures we have implemented to prevent security breaches and cyber incidents may not be effective. The theft, destruction, loss, misappropriation, or release of sensitive and/or confidential information or intellectual property, or interference with our information technology systems or the technology systems of third parties on which we rely, could result in business disruption, negative publicity, brand damage, violation of privacy laws, loss of residents, potential liability and competitive disadvantage, any of which could result in a material adverse effect on our financial condition or results of operations.

Our board ofdirectors determined an estimated value per share of $10.35 for our shares of common stock as of December 31, 2014. You should not rely on the estimated value per share as being an accurate measure of the current value of our shares of common stock.

On March 10, 2015, our board of directors determined an estimated value per share of our common stock of $10.35 as of December 31, 2014. Our board of directors’ objective in determining the estimated value per share was to arrive at a value, based on the most recent data available, that it believed was reasonable based on methodologies that it deemed appropriate after consultation with our advisor. However, the market for commercial real estate can fluctuate quickly and substantially and the value of our assets is expected to change in the future and may decrease. Also, our board of directors did not consider certain other factors, such as a liquidity discount to reflect the fact that our shares are not currently traded on a national securities exchange and the limitations on the ability to redeem shares pursuant to our share repurchase program.

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As with any valuation methodology, the methodologies used to determine the estimated value per share were based upon a number of assumptions, estimates and judgments that may not be accurate or complete. Our assets have been valued based upon appraisal standards and the value of our assets using these methodologies are not required to be a reflection of market value under those standards and will not result in a reflection of fair value under GAAP. Further, different parties using different property-specific and general real estate and capital market assumptions, estimates, judgments and standards could derive a different estimated value per share, which could be significantly different from the estimated value per share determined by our board of directors. The estimated value per share does not represent the fair value of our assets less liabilities in accordance with United States GAAP as of December 31, 2014. The estimated value per share is not a representation or indication that: a stockholder would be able to realize the estimated value per share if he or she attempts to sell shares; a stockholder would ultimately realize distributions per share equal to the estimated value per share upon liquidation of assets and settlement of our liabilities or upon a sale of our company; shares of our common stock would trade at the estimated value per share on a national securities exchange; a third party would offer the estimated value per share in an arms-length transaction to purchase all or substantially all of our shares of common stock; or the methodologies used to estimate the value per share would be acceptable to FINRA or ERISA with respect to their respective requirements. Further, the estimated value per share was calculated as of a moment in time and the value of our shares will fluctuate over time as a result of, among other things, future acquisitions or dispositions of assets (including acquisitions and dispositions of real estate investments since December 31, 2014), developments related to individual assets and changes in the real estate and capital markets. For additional information on the calculation of our estimated value per share as of December 31, 2014, see Item 5.,“Market for Registrant’s Common Equity, Related Stockholder Matters and Purchases of Equity Securities—Estimated Value Per Share.”

The actual value of shares that we repurchase under our share repurchase plan may be substantially less than what we pay.

We adopted a share repurchase plan through which shares may be repurchased at varying prices depending on (1) the number of years the shares have been held, (2) the purchase price paid for the shares and (3) whether the redemptions are sought upon a stockholder’s death or disability. However, effective November 20, 2014, our board of directors suspended our share repurchase plan. There is no assurance as to when we will reinstate our share repurchase plan, if at all. If we reinstate our share repurchase plan, the repurchase price is likely to differ from the price at which a stockholder could resell his or her shares. If the actual value of the shares that we repurchase is less than the repurchase price, the repurchase could be dilutive to our remaining stockholders. Even at lower repurchase prices, the actual value of the shares may be substantially less than what we pay and the repurchase may be dilutive to our remaining stockholders.

Because our charter does not require our listing or liquidation by a specified date, you should be prepared to hold our shares for an indefinite period of time.

On October 21, 2014, we announced that we had retained an investment banker as our financial advisor to assist in evaluating strategic alternatives for a potential liquidity event. Our board of directors completed a thorough review of the strategic alternatives available to us, and on March 10, 2015, concluded the engagement with our investment banker, subject to the terms of our engagement letter. Our board of directors determined that given that a substantial portion of our apartment communities were acquired during and after the final four months of our offering period, and as we are continuing to execute on their operational phase, it is in the best interests of our stockholders to continue to execute our business plan through the continuation of our targeted renovations and introduction of property-level operational initiatives to increase property values. As a result, our board of directors, including a majority of our independent directors, determined to not pursue a liquidity event at this time.

Under our charter, if we have not determined to pursue a liquidity event by December 31, 2016, our charter requires that we either (1) seek stockholder approval of our liquidation or (2) postpone presenting the liquidation decision to our stockholders if a majority of our board of directors, including a majority of the independent directors, determines that liquidation is not then in the best interests of our stockholders. If a majority of our board of directors, including a majority of the independent directors, determines that liquidation is not then in the best interests of our stockholders, our charter requires our board of directors to reconsider whether to seek stockholder approval of our liquidation at least annually.

Further postponement of a liquidity event or stockholder action regarding liquidation would only be permitted if a majority of our board of directors, including a majority of the independent directors, again determined that liquidation would not be in the best interests of our stockholders. If we sought and failed to obtain stockholder approval of our liquidation, our charter would not require us to consummate our liquidation and would not require our board of directors to reconsider whether to seek

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stockholder approval of our liquidation. There is no guarantee as to when our board of directors will pursue a liquidity event or submit a liquidation decision to our stockholders, if at all, and you should therefore be prepared to hold our shares for an indefinite period of time.

Payment of fees to our advisor and its affiliates reduces cash available for investment, which may result in our stockholders not receiving a full return of their invested capital.

Because a portion of the offering proceeds from the sale of our shares and cash flow generated from our operations were used to pay fees and expenses to our advisor and its affiliates, the amount of cash available for investments in real properties and real estate-related assets was reduced. As a result, stockholders will only receive a full return of their invested capital if we either: (1) sell our assets or our company for a sufficient amount in excess of the original purchase price of our assets or (2) the market value of our company after we list our shares of common stock on a national securities exchange is substantially in excess of the original purchase price of our assets.

If we internalize our management functions, your interest in us could be diluted and we could incur other significant costs associated with being self-managed.

Our board of directors may decide in the future to internalize our management functions. If we do so, we may elect to negotiate to acquire our advisor’s assets and personnel. At this time, we cannot anticipate the form or amount of consideration or other terms relating to any such acquisition. Such consideration could take many forms, including cash payments, promissory notes and shares of our common stock. The payment of such consideration could result in dilution of your interests as a stockholder and could have an adverse effect on our financial condition and ability to make distributions to our stockholders.

Additionally, while we would no longer bear the costs of the various fees and expenses we expect to pay to our advisor under the advisory agreement, our direct expenses would include general and administrative costs, including legal, accounting and other expenses related to corporate governance, SEC reporting and compliance. We would also be required to employ personnel and would be subject to potential liabilities commonly faced by employers, such as workers disability and compensation claims, potential labor disputes and other employee-related liabilities and grievances as well as incur the compensation and benefits costs of our officers and other employees and consultants that will be paid by our advisor or its affiliates. We may issue equity awards to officers, employees and consultants, which awards would decrease net income and funds from operations and may further dilute your investment. We cannot reasonably estimate the amount of fees to our advisor we would save or the costs we would incur if we became self-managed. If the expenses we assume as a result of an internalization are higher than the expenses we avoid paying to our advisor, our funds from operations would be lower as a result of the internalization than they otherwise would have been, potentially decreasing the amount of funds available to distribute to our stockholders.

Internalization transactions involving the acquisition of advisors have also, in some cases, been the subject of litigation. Even if these claims are without merit, we could be forced to spend significant amounts of money defending claims which would reduce the amount of funds available for us to invest or to pay distributions.

You are limited in your ability to have your shares of common stock repurchased pursuant to our share repurchase plan. You may not be able to sell any of your shares of our common stock back to us, and if you do sell your shares, you may not receive the price you paid upon subscription.

Our share repurchase plan was suspended effective November 20, 2014. Our board of directors may in the future reinstate our share repurchase plan, although there is no assurance as to if or when this will happen. If the share repurchase is reinstated, our share repurchase plan may provide you with an opportunity to have your shares of common stock repurchased by us. We anticipate that shares of our common stock may be repurchased on a quarterly basis. No shares may be repurchased under our share repurchase plan until after the first anniversary of the date of purchase of such shares. Prior to the first determination of our estimated value per share following the completion of our offering stage, we repurchased shares of our common stock pursuant to our share repurchase plan at a discount from the purchase price based upon how long such shares have been held. Notwithstanding the foregoing, following the first determination of our estimated value per share following the completion of our offering stage, shares of our common stock will be repurchased at a price equal to a price based upon our estimated value per share as of our most recent appraisal.

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Our share repurchase plan contains certain restrictions and limitations, including those relating to the number of shares of our common stock that we can repurchase at any given time and limiting the repurchase price. Specifically, the share repurchase plan limits the number of shares to be repurchased during any calendar year to no more than (1) 5.0% of the weighted average number of shares of our common stock outstanding in the prior calendar year and (2) those that could be funded from the net proceeds from the sale of shares under our distribution reinvestment plan in the prior calendar year plus such additional funds as may be borrowed or reserved for that purpose by our board of directors. Further, we have no obligation to repurchase shares if the repurchase would violate the restrictions on distributions under Maryland law, which prohibits distributions that would cause a corporation to fail to meet statutory tests of solvency. Our board of directors reserves the right to reject any repurchase request for any reason or no reason or to amend or terminate the share repurchase plan at any time upon 30 days notice to our stockholders. Therefore, you may not have the opportunity to make a repurchase request prior to a potential termination of the share repurchase plan and you may not be able to sell any of your shares of common stock back to us. Moreover, if you do sell your shares of common stock back to us pursuant to the share repurchase plan, you may be forced to do so at a discount to the purchase price you paid for your shares.

Our success is dependent on the performance of our advisor and its affiliates.

Our ability to achieve our investment objectives and to pay distributions is dependent upon the performance of our advisor and its affiliates. Our advisor and its affiliates are sensitive to trends in the general economy, as well as the commercial real estate and credit markets. The recent economic recession and accompanying credit crisis negatively impacted the value of commercial real estate assets, contributing to a general slow down in the real estate industry. The failure to achieve a sustained economic recovery or renewed economic downturn could result in continued reductions in overall transaction volume and size of sales and leasing activities that our advisor and its affiliates have recently experienced, and would continue to put downward pressure on our advisor’s and its affiliates’ revenues and operating results. To the extent that any decline in revenues and operating results impacts the performance of our advisor and its affiliates, our financial condition and ability to pay distributions to our stockholders could also suffer.

Additionally, our advisor relies primarily on the fees it receives pursuant to the advisory agreement and capital from our sponsor to fund its operations and liabilities. If our advisor has insufficient cash from operations to meet its obligations under the advisory agreement and is unable to obtain financing, we would be adversely impacted.

Events in United States financial markets have had, and may continue to have, a negative impact on the terms and availability of credit and the overall national economy, which could have an adverse effect on our business and our results of operations.

The failure of large United States financial institutions in 2008 and the resulting turmoil in the United States financial sector has had a negative impact on the terms and availability of credit and the state of the economy generally within the United States. The tightening of the U.S. credit markets resulted in a lack of adequate credit. Some lenders continue to impose more stringent restrictions on the terms of credit, including shorter terms and more conservative loan-to-value underwriting than was previously customary. The negative impact of the tightening of the credit markets may limit our ability to finance the acquisition of properties and other real estate-related assets on favorable terms, if at all, and may result in increased financing costs or financing with increasingly restrictive covenants.

Additionally, decreasing home prices and mortgage defaults may again result in uncertainty in the real estate and real estate securities and debt markets. Until recently, the market for new issuances of commercial mortgage-backed securities, or CMBS, had been significantly reduced as a result of the recent turmoil in the financial markets and banks generally are providing limited debt financing with more stringent conditions for investments in real estate-related assets. As a result, the valuation of real estate-related assets has been volatile and is likely to continue to be volatile in the future. The volatility in markets may make it more difficult for us to obtain adequate financing or realize gains on our investments which could have an adverse effect on our business and our results of operations.

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We are uncertain of our sources for funding our future capital needs. If we do not have sufficient funds from operations to cover our expenses or to fund improvements to our real estate and cannot obtain debt or equity financing on acceptable terms, our ability to cover our expenses or to fund improvements to our real estate may be adversely affected.

We terminated our initial public offering on December 20, 2013. In the event that we develop a need for additional capital in the future for the improvement of our real properties or for any other reason, sources of funding may not be available to us. If we do not have sufficient funds from cash flow generated by our investments or out of net sale proceeds, or cannot obtain debt or equity financing on acceptable terms, our financial condition and ability to make distributions may be adversely affected.

If we cease to retain our advisor or one of its affiliates to perform substantial advisory services for us, we may be required to cease to conduct business under or use the name “Steadfast” or any derivative thereof.

Pursuant to the terms of the advisory agreement, if we cease to retain our advisor or one of its affiliates to perform substantial advisory services for us, we are required, upon receipt of written request from our advisor, to cease to conduct business under or use the name “Steadfast” or any derivative thereof and to change our name and the names of our subsidiaries to a name that does not contain the word “Steadfast” or any other word or words that might, in the reasonable discretion of our advisor, indicate some form of relationship between us and our advisor or its affiliates. If we are required to cease to conduct business under or use the name “Steadfast” or any derivative thereof, it could have an adverse effect on our ability to achieve our investment objectives.

Risks Relating to Our Organizational Structure

Maryland law and our organizational documents limit your right to bring claims against our officers and directors.

Maryland law provides that a director will not have any liability as a director so long as he or she performs his or her duties in accordance with the applicable standard of conduct. In addition, our charter provides that, subject to the applicable limitations set forth therein or under Maryland law, no director or officer will be liable to us or our stockholders for monetary damages. Our charter also provides that we will generally indemnify our directors, our officers, our advisor and its affiliates for losses they may incur by reason of their service in those capacities unless their act or omission was material to the matter giving rise to the proceeding and was committed in bad faith or was the result of active and deliberate dishonesty, they actually received an improper personal benefit in money, property or services or, in the case of any criminal proceeding, they had reasonable cause to believe the act or omission was unlawful. Moreover, we have entered into separate indemnification agreements with each of our directors and executive officers. As a result, we and our stockholders may have more limited rights against these persons than might otherwise exist under common law. In addition, we may be obligated to fund the defense costs incurred by these persons. However, our charter provides that we may not indemnify our directors, our advisor and its affiliates for loss or liability suffered by them or hold our directors or our advisor and its affiliates harmless for loss or liability suffered by us unless they have determined that the course of conduct that caused the loss or liability was in our best interests, they were acting on our behalf or performing services for us, the liability was not the result of negligence or misconduct by our non-independent directors, our advisor and its affiliates or gross negligence or willful misconduct by our independent directors, and the indemnification or agreement to hold harmless is recoverable only out of our net assets, including the proceeds of insurance, and not from the stockholders. As a result of these limitations on liability and indemnification provisions and agreements, we and our stockholders may be entitled to a more limited right of action than we would otherwise have if indemnification rights were not granted.

The limit on the percentage of shares of our common stock that any person may own may discourage a takeover or business combination that may benefit our stockholders.

Our charter restricts the direct or indirect ownership by one person or entity to no more than 9.8% of the value of our then outstanding capital stock (which includes common stock and any preferred stock we may issue) and no more than 9.8% of the value or number of shares, whichever is more restrictive, of our then outstanding common stock unless exempted by our board of directors. These restrictions may discourage a change of control of us and may deter individuals or entities from making tender offers for shares of our common stock on terms that might be financially attractive to stockholders or which may cause a change in our management. In addition to deterring potential transactions that may be favorable to our stockholders, these provisions may also decrease your ability to sell your shares of our common stock.

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We may issue preferred stock or other classes of common stock, which issuance could adversely affect the holders of our common stock.

Investors in our common stock do not have preemptive rights to any shares issued by us in the future. We may issue, without stockholder approval, preferred stock or other classes of common stock with rights that could dilute the value of your shares of common stock. However, the issuance of preferred stock must also be approved by a majority of our independent directors not otherwise interested in the transaction, who will have access, at our expense, to our legal counsel or to independent legal counsel. The issuance of preferred stock or other classes of common stock may increase the number of stockholders entitled to distributions without simultaneously increasing the size of our asset base. Under our charter, we have authority to issue a total of 1,100,000,000 shares of capital stock, of which 999,999,000 shares are designated as common stock with a par value of $0.01 per share, 100,000,000 shares are designated as preferred stock with a par value of $0.01 per share, and 1,000 shares are designated as convertible stock with a par value of $0.01 per share. Our board of directors, with the approval of a majority of the entire board of directors and without any action by our stockholders, may amend our charter from time to time to increase or decrease the aggregate number of shares of capital stock or the number of shares of capital stock of any class or series that we have authority to issue. If we ever created and issued preferred stock with a distribution preference over common stock, payment of any distribution preferences of outstanding preferred stock would reduce the amount of funds available for the payment of distributions on our common stock. Further, holders of preferred stock are normally entitled to receive a preference payment in the event we liquidate, dissolve or wind up before any payment is made to our common stockholders, likely reducing the amount common stockholders would otherwise receive upon such an occurrence. In addition, under certain circumstances, the issuance of preferred stock or a separate class or series of common stock may render more difficult or tend to discourage a merger, tender offer or proxy contest, the assumption of control by a holder of a large block of our securities, or the removal of incumbent management.

Your investment will be diluted upon conversion of the convertible stock.

We have issued 1,000 shares of our convertible stock to our advisor. Under limited circumstances, each outstanding share of our convertible stock may be converted into shares of our common stock, which will have a dilutive effect to our stockholders. Our convertible stock will be converted into shares of common stock if (1) we have made total distributions on the then outstanding shares of our common stock equal to the price paid for those shares plus an 8.0% cumulative, non-compounded, annual return on that price, (2) we list our common stock for trading on a national securities exchange or enter into a merger whereby holders of our common stock receive listed securities of another issuer or (3) our advisory agreement is terminated or not renewed (other than for “cause” as defined in our advisory agreement). Upon any of these events, each share of convertible stock will be converted into a number of shares of common stock equal to 1/1000 of the quotient of (A) 10% of the amount, if any, by which (i) our “enterprise value” plus the aggregate value of the distributions paid to date on the then outstanding shares exceeds (ii) the aggregate purchase price paid by stockholders for those outstanding shares plus an 8.0% cumulative, non-compounded, annual return on the original issue price of the shares, divided by (B) our enterprise value divided by the number of outstanding shares of our common stock on an as-converted basis as of the date of conversion. In the event of a termination or non-renewal of our advisory agreement for cause, the convertible stock will be redeemed by us for $1.00. Upon the issuance of our common stock in connection with the conversion of our convertible stock, your interests in us will be diluted.

We grant stock-based awards to our directors and may in the future grant such awards to our advisor’s employees and consultants pursuant to our long-term incentive plan, which will have a dilutive effect on your investment in us.

We have adopted a long-term incentive plan pursuant to which we are authorized to grant restricted stock, stock options, stock appreciation rights, restricted or deferred stock units, performance awards, dividend equivalents or other stock-based awards to directors, our advisor’s employees and consultants selected by our board of directors for participation in the plan. As of December 31, 2014, we have issued an aggregate of 60,625 shares of restricted stock to our independent directors pursuant to this plan. We currently intend only to issue awards of restricted stock to our independent directors under our long-term incentive plan. If we issue additional stock-based awards to eligible participants under our long-term incentive plan, the issuance of these stock-based awards will dilute your investment in our shares of common stock.

Certain features of our long-term incentive plan could have a dilutive effect on your investment in us, including (1) a lack of annual award limits, individually or in the aggregate (subject to the limit on the maximum number of shares which may be issued pursuant to awards granted under the plan), (2) the fact that the limit on the maximum number of shares which may be issued pursuant to awards granted under the plan is not tied to the amount of proceeds raised in the offering and (3) share

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counting procedures which provide that shares subject to certain awards, including, without limitation, substitute awards granted by us to employees of another entity in connection with our merger or consolidation with such company or shares subject to outstanding awards of another company assumed by us in connection with our merger or consolidation with such company, are not subject to the limit on the maximum number of shares which may be issued pursuant to awards granted under the plan.

The conversion of the convertible stock held by our advisor due upon termination of the advisory agreement and the voting rights granted to the holder of our convertible stock, may discourage a takeover attempt or prevent us from effecting a merger that otherwise would have been in the best interests of our stockholders.

If we engage in a merger in which we are not the surviving entity or our advisory agreement is terminated without cause, our advisor may be entitled to conversion of the shares of our convertible stock it holds and to require that we purchase all or a portion of the limited partnership interests in our operating partnership that it holds at any time thereafter for cash or our common stock. The existence of this convertible stock may deter a prospective acquirer from bidding on our company, which may limit the opportunity for stockholders to receive a premium for their stock that might otherwise exist if an investor attempted to acquire us through a merger.

The affirmative vote of two-thirds of the outstanding shares of convertible stock, voting as a single class, will be required (1) for any amendment, alteration or repeal of any provision of our charter that materially and adversely changes the rights of the convertible stock and (2) to effect a merger of our company into another entity, or a merger of another entity into our company, unless in each case each share of convertible stock (A) will remain outstanding without a material and adverse change to its terms and rights or (B) will be converted into or exchanged for shares of stock or other ownership interest of the surviving entity having rights identical to that of our convertible stock. In the event that we propose to merge with or into another entity, including another REIT, our advisor could, by exercising these voting rights, determine whether or not we are able to complete the proposed transaction. By voting against a proposed merger, our advisor could prevent us from effecting the merger, even if the merger otherwise would have been in the best interests of our stockholders.

Our UPREIT structure may result in potential conflicts of interest with limited partners in our operating partnership whose interests may not be aligned with those of our stockholders.

Limited partners in our operating partnership have the right to vote on certain amendments to the operating partnership agreement, as well as on certain other matters. Persons holding such voting rights may exercise them in a manner that conflicts with the interests of our stockholders. As general partner of our operating partnership, we are obligated to act in a manner that is in the best interest of all partners of our operating partnership. Circumstances may arise in the future when the interests of limited partners in our operating partnership may conflict with the interests of our stockholders. These conflicts may be resolved in a manner stockholders do not believe are in their best interest.

We may change our targeted investments and investment guidelines without stockholder consent.

Our board of directors may change our targeted investments and investment guidelines at any time without the consent of our stockholders, which could result in our making investments that are different from, and possibly riskier than, the investments described in this prospectus. A change in our targeted investments or investment guidelines may increase our exposure to interest rate risk, default risk and real estate market fluctuations, all of which could adversely affect the value of our common stock and our ability to make distributions to you.

Your investment return may be reduced if we are required to register as an investment company under the Investment Company Act; if we are subject to registration under the Investment Company Act, we will not be able to continue our business.

Neither we, our operating partnership or any of our subsidiaries intend to register as an investment company under the Investment Company Act. Our operating partnership’s and subsidiaries’ investments in real estate will represent the substantial majority of our total asset mix. In order for us not to be subject to regulation under the Investment Company Act, we engage, through our operating partnership and our wholly and majority owned subsidiaries, primarily in the business of buying real estate. These investments must be made within a year after our public offering ends.

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We expect that most of our assets will be held through wholly-owned or majority-owned subsidiaries of our operating partnership. We expect that most of these subsidiaries will be outside the definition of an “investment company” under Section 3(a)(1) of the Investment Company Act as they are generally expected to hold at least 60% of their assets in real property. Section 3(a)(1)(A) of the Investment Company Act defines an investment company as any issuer that is or holds itself out as being engaged primarily in the business of investing, reinvesting or trading in securities. Section 3(a)(1)(C) of the Investment Company Act defines an investment company as any issuer that is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire investment securities having a value exceeding 40% of the value of the issuer’s total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis, which we refer to as the “40% test.” Excluded from the term “investment securities,” among other things, are U.S. government securities and securities issued by majority-owned subsidiaries that are not themselves investment companies and are not relying on the exception from the definition of investment company set forth in Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act.

We believe that we, our operating partnership and most of the subsidiaries of our operating partnership will not fall within either definition of investment company under Section 3(a)(1) of the Investment Company Act as we intend to invest primarily in real property, through our wholly or majority-owned subsidiaries, the majority of which we expect to have at least 60% of their assets in real property. As these subsidiaries would be investing either solely or primarily in real property, they would be outside of the definition of “investment company” under Section 3(a)(1) of the Investment Company Act. We are organized as a holding company that conducts its businesses primarily through our operating partnership, which in turn is a holding company conducting its business through its subsidiaries. Both we and our operating partnership intend to conduct our operations so that they comply with the 40% test. We will monitor our holdings to ensure continuing and ongoing compliance with this test. In addition, we believe that neither we nor our operating partnership will be considered an investment company under Section 3(a)(1)(A) of the Investment Company Act because neither we nor our operating partnership will engage primarily or hold itself out as being engaged primarily in the business of investing, reinvesting or trading in securities. Rather, through our operating partnership’s wholly owned or majority owned subsidiaries, we and our operating partnership will be primarily engaged in the non-investment company businesses of these subsidiaries, namely the business of purchasing or otherwise acquiring real property.

In the event that the value of investment securities held by a subsidiary of our operating partnership were to exceed 40% of the value of its total assets, we expect that subsidiary to be able to rely on the exclusion from the definition of “investment company” provided by Section 3(c)(5)(C) of the Investment Company Act. Section 3(c)(5)(C), as interpreted by the staff of the SEC, requires each of our subsidiaries relying on this exception to invest at least 55% of its portfolio in “mortgage and other liens on and interests in real estate,” which we refer to as “qualifying real estate assets,” and maintain at least 80% of its assets in qualifying real estate assets or other real estate-related assets. The remaining 20% of the portfolio can consist of miscellaneous assets. What we buy and sell is therefore limited by these criteria. How we determine to classify our assets for purposes of the Investment Company Act will be based in large measure upon no-action letters issued by the SEC staff in the past and other SEC interpretive guidance and, in the absence of SEC guidance, on our view of what constitutes a qualifying real estate asset and a real estate-related asset. These no-action positions were issued in accordance with factual situations that may be substantially different from the factual situations we may face, and a number of these no-action positions were issued more than ten years ago. Pursuant to this guidance, and depending on the characteristics of the specific investments, certain mortgage loans, participations in mortgage loans, mortgage-backed securities, mezzanine loans, joint venture investments and the equity securities of other entities may not constitute qualifying real estate assets and therefore investments in these types of assets may be limited. No assurance can be given that the SEC staff will concur with our classification of our assets. Future revisions to the Investment Company Act or further guidance from the SEC or its staff may cause us to lose our exclusion from the definition of investment company or force us to re-evaluate our portfolio and our investment strategy. Such changes may prevent us from operating our business successfully.

There can be no assurance that the laws and regulations governing the Investment Company Act status of REITs, including more specific or different guidance regarding these exclusions that may be published by the SEC or its staff, will not change in a manner that adversely affects our operations. In addition, the SEC or its staff could take action that results in our or our subsidiary's failure to maintain an exception or exemption from the Investment Company Act.

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In the event that we, or our operating partnership, were to acquire assets that could make either entity fall within the definition of an investment company under Section 3(a)(1) of the Investment Company Act, we believe that we would still qualify for an exclusion from registration pursuant to Section 3(c)(6). Although the SEC staff has issued little interpretive guidance with respect to Section 3(c)(6), we believe that we and our operating partnership may rely on Section 3(c)(6) if 55% of the assets of our operating partnership consist of, and at least 55% of the income of our operating partnership is derived from, qualifying real estate assets owned by wholly owned or majority-owned subsidiaries of our operating partnership.

To ensure that neither we, our operating partnership or any of our subsidiaries are required to register as an investment company, each entity may be unable to sell assets that it would otherwise want to sell and may need to sell assets that it would otherwise wish to retain. In addition, we, our operating partnership or our subsidiaries may be required to acquire additional income- or loss-generating assets that we might not otherwise acquire or forego opportunities to acquire interests in companies that we would otherwise want to acquire. Although we, our operating partnership and our subsidiaries intend to monitor our portfolio periodically and prior to each acquisition and disposition, any of these entities may not be able to remain outside the definition of investment company or maintain an exclusion from the definition of investment company. If we, our operating partnership or our subsidiaries are required to register as an investment company but fail to do so, the unregistered entity would be prohibited from engaging in our business, and criminal and civil actions could be brought against such entity. In addition, the contracts of such entity would be unenforceable unless a court required enforcement, and a court could appoint a receiver to take control of the entity and liquidate its business.

Risks Related To Conflicts of Interest

We depend on our advisor and its key personnel and if any of such key personnel were to cease to be affiliated with our advisor, our business could suffer.

Our ability to achieve our investment objectives is dependent upon the performance of our advisor. Our success depends to a significant degree upon the continued contributions of certain of the key personnel of our advisor, each of whom would be difficult to replace. We currently do not have key man life insurance on any of our advisor’s personnel. If our advisor were to lose the benefit of the experience, efforts and abilities of any these individuals, our operating results could suffer.

Our advisor and its affiliates, including our officers and our affiliated directors, will face conflicts of interest caused by compensation arrangements with us, which could result in actions that are not in the best interests of our stockholders.

Our advisor and its affiliates receive substantial fees from us in return for their services and these fees could influence the advice provided to us. Among other matters, these compensation arrangements could affect their judgment with respect to:

• public offerings of equity by us, which allow the dealer manager to earn additional dealer manager fees and allows our advisor to earn increased acquisition fees and investment management fees;

• real property sales, since the investment management fees and property management fees payable to our advisor and its affiliates would decrease upon the disposition of an investment; and

• the purchase of assets from our sponsor and its affiliates, which may allow our advisor or its affiliates to earn additional acquisition fees, investment management fees and property management fees.

Further, our advisor may recommend that we invest in a particular asset or pay a higher purchase price for the asset than it would otherwise recommend if it did not receive an acquisition fee in connection with such transactions. Certain potential acquisition fees and investment management fees payable to our advisor and property management fees payable to our property manager will be paid irrespective of the quality of the underlying real estate or property management services. These fees may influence our advisor to recommend transactions with respect to the sale of a property or properties that may not be in our best interest. Our advisor will have considerable discretion with respect to the terms and timing of our acquisition, disposition and leasing transactions. In evaluating investments and other management strategies, the opportunity to earn these fees may lead our advisor to place undue emphasis on criteria relating to its compensation at the expense of other criteria, such as the preservation of capital, to achieve higher short-term compensation. This could result in decisions that are not in the best interests of our stockholders.

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We may compete with affiliates of our sponsor for opportunities to acquire or sell investments, which may have an adverse impact on our operations.

We may compete with affiliates of our sponsor for opportunities to acquire or sell real properties and other real estate-related assets. We may also buy or sell real properties and other real estate-related assets at the same time as affiliates of our sponsor. In this regard, there is a risk that our sponsor will select for us investments that provide lower returns to us than investments purchased by its affiliates. Certain of our affiliates own or manage real properties in geographical areas in which we expect to own real properties. As a result of our potential competition with affiliates of our sponsor, certain investment opportunities that would otherwise be available to us may not in fact be available. This competition may also result in conflicts of interest that are not resolved in our favor.

The time and resources that our sponsor and its affiliates could devote to us may be diverted to other investment activities, and we may face additional competition due to the fact that our sponsor and its affiliates are not prohibited from raising money for, or managing, another entity that makes the same types of investments that we do.

Our sponsor and its affiliates are not prohibited from raising money for, or managing, another investment entity that makes the same types of investments as we do. For example, on December 30, 2013, Steadfast Apartment REIT, a non-listed REIT sponsored by our sponsor, commenced its initial public offering of up to $1,100,000,000 in shares of common stock. As a result, the time and resources our sponsor and its affiliates could devote to us may be diverted to other investment activities. Additionally, some of our directors and officers may serve as directors and officers of investment entities sponsored by our sponsor and its affiliates. We cannot currently estimate the time our officers and directors will be required to devote to us because the time commitment required of our officers and directors will vary depending upon a variety of factors, including, but not limited to, general economic and market conditions affecting us and our advisor’s ability to locate and acquire investments that meet our investment objectives. Since these professionals engage in and will continue to engage in other business activities on behalf of themselves and others, these professionals will face conflicts of interest in allocating their time among us, our advisor and its affiliates and other business activities in which they are involved. This could result in actions that are more favorable to affiliates of our advisor than to us.

In addition, we may compete with affiliates of our advisor for the same investors and investment opportunities. We may also co-invest with any such investment entity. Even though all such co-investments will be subject to approval by our independent directors, they could be on terms not as favorable to us as those we could achieve co-investing with a third party.

Our advisor may have conflicting fiduciary obligations if we acquire assets from affiliates of our sponsor or enter into joint ventures with affiliates of our sponsor. As a result, in any such transaction we may not have the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

Our advisor may cause us to invest in a property owned by, or make an investment in equity securities in or real estate-related loans to, our sponsor or its affiliates or through a joint venture with affiliates of our sponsor. In these circumstances, our advisor will have a conflict of interest when fulfilling its fiduciary obligation to us. In any such transaction, we would not have the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

The fees we pay to affiliates in connection with the acquisition and management of our investments were determined without the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

The fees to be paid to our advisor, our property managers and other affiliates for services they provide for us were determined without the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties, may be in excess of amounts that we would otherwise pay to third parties for such services and may reduce the amount of cash that would otherwise be available for investments in real properties and distributions to our stockholders.

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Risks Related To Investments in Real Estate

Our operating results will be affected by economic and regulatory changes that impact the real estate market in general.

Our investments in real properties will be subject to risks generally attributable to the ownership of real property, including:

• changes in global, national, regional or local economic, demographic or real estate market conditions;

• changes in supply of or demand for similar properties in an area;

• increased competition for real property investments targeted by our investment strategy;

• bankruptcies, financial difficulties or lease defaults by our tenants;

• changes in interest rates and availability of financing;

• changes in the terms of available financing, including more conservative loan-to-value requirements and shorter debt maturities;

• competition from residential buildings;

• the inability or unwillingness of residents to pay rent increases;

• changes in government rules, regulations and fiscal policies, including changes in tax, real estate, environmental and zoning laws;

• the severe curtailment of liquidity for certain real estate-related assets; and

• rent restrictions due to government program requirements.

All of these factors are beyond our control. Any negative changes in these factors could affect our ability to meet our obligations and make distributions to stockholders.

We are unable to predict future changes in global, national, regional or local economic, demographic or real estate market conditions. For example, a recession or rise in interest rates could make it more difficult for us to lease or dispose of real properties and could make alternative interest-bearing and other investments more attractive and therefore potentially lower the relative value of the real estate assets we acquire. These conditions, or others we cannot predict, may adversely affect our results of operations and returns to our stockholders. In addition, the value of the real properties we acquire may decrease following the date we acquire such properties due to the risks described above or any other unforeseen changes in market conditions. If the value of our real properties decreases, we may be forced to dispose of the properties at a price lower than the price we paid to acquire our properties, which could adversely impact results of our operations and our our ability to make distributions and return capital to our investors.

A concentration of our investments in the apartment community sector may leave our profitability vulnerable to a downturn or slowdown in the sector.

Our property portfolio is comprised solely of multifamily properties. As a result, we will be subject to risks inherent in investments in a single type of property. Because our investments are in the apartment community sector, the potential effects on our revenues, and as a result, on cash available for distribution to our stockholders, resulting from a downturn or slowdown in the apartment community sector could be more pronounced than if we had more fully diversified our investments.

We depend on tenants for our revenue, and, accordingly, our revenue and our ability to make distributions to our stockholders is dependent upon the ability of the tenants of our properties to generate enough income to pay their rents in a timely manner. Substantial non-renewals, terminations or lease defaults could reduce our net income and limit our ability to make distributions to our stockholders.

The underlying value of our properties and the ability to make distributions to our stockholders depend upon the ability of the tenants of our properties to generate enough income to pay their rents in a timely manner, and the success of our investments depends upon the occupancy levels, rental income and operating expenses of our properties and our company. Tenants’ inability to timely pay their rents may be impacted by employment and other constraints on their personal finances, including debts, purchases and other factors. These and other changes beyond our control may adversely affect our tenants’

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ability to make lease payments. In the event of a tenant default or bankruptcy, we may experience delays in enforcing our rights as landlord and may incur costs in protecting our investment and re-leasing our property. We may be unable to re-lease the property for the rent previously received. We may be unable to sell a property with low occupancy without incurring a loss. These events and others could cause us to reduce the amount of distributions we make to stockholders and the value of our stockholders’ investment to decline.

We may be unable to secure funds for future capital improvements, which could adversely impact our ability to make cash distributions to our stockholders.

When residents do not renew their leases or otherwise vacate their apartment homes, in order to attract replacement residents, we may be required to expend funds for capital improvements to the vacated apartment homes. In addition, we may require substantial funds to renovate an apartment community in order to sell it, upgrade it or reposition it in the market. If we have insufficient capital reserves, we will have to obtain financing from other sources. We intend to establish capital reserves in an amount we, in our discretion, believe is necessary. A lender also may require escrow of capital reserves in excess of any established reserves. If these reserves or any reserves otherwise established are designated for other uses or are insufficient to meet our cash needs, we may have to obtain financing from either affiliated or unaffiliated sources to fund our cash requirements. We cannot assure our stockholders that sufficient financing will be available or, if available, will be available on economically feasible terms or on terms acceptable to us. Moreover, certain reserves required by lenders may be designated for specific uses and may not be available for capital purposes such as future capital improvements. Additional borrowing for capital needs and capital improvements will increase our interest expense, and therefore our financial condition and our ability to make cash distributions to our stockholders may be adversely affected.

Real property that experiences significant vacancy could be difficult to sell or re-lease.

A real property may experience a vacancy either by the continued default of a tenant under its lease or the expiration of one of our leases. Certain of the real properties we acquire may have some level of vacancy at the time of closing of our acquisition of the property. Certain other real properties may not be specifically suited to the particular needs of a tenant and may become vacant. There can be no assurances that we will have the funds available to correct defects or make capital improvements necessary to attract replacement tenants. As a result, we may have difficulty obtaining a new tenant for any vacant space we have in our real properties. If the vacancy continues for a long period of time, we may suffer reduced revenues resulting in lower cash distributions to stockholders. In addition, the resale value of the real property could be diminished because the market value may depend principally upon the value of the leases of such real property.

We will compete with numerous other persons and entities for real estate assets and tenants.

We will compete with numerous other persons and entities in acquiring real property and attracting tenants to real properties we acquire. These persons and entities may have greater experience and financial strength than us. There is no assurance that we will be able to acquire real properties or attract tenants to real properties we acquire on favorable terms, if at all. For example, our competitors may be willing to offer space at rental rates below our rates, causing us to lose existing or potential tenants and pressuring us to reduce our rental rates to retain existing tenants or convince new tenants to lease space at our properties. Each of these factors could adversely affect our results of operations, financial condition, value of our investments and ability to pay distributions to you.

Real properties are illiquid investments, and we may be unable to adjust our portfolio in response to changes in economic or other conditions or sell a property if or when we decide to do so.

Real properties are illiquid investments. We may be unable to adjust our portfolio in response to changes in economic or other conditions. In addition, the real estate market is affected by many factors, such as general economic conditions, availability of financing, interest rates, supply and demand, and other factors that are beyond our control. We cannot predict whether we will be able to sell any real property for the price or on the terms set by us, or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We cannot predict the length of time needed to find a willing purchaser and to close the sale of a real property. Additionally, we may be required to expend funds to correct defects or to make improvements before a real property can be sold. We cannot assure you that we will have funds available to correct such defects or to make such improvements.

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In acquiring a real property, we may agree to restrictions that prohibit the sale of that real property for a period of time or impose other restrictions, such as a limitation on the amount of debt that can be placed or repaid on that real property. All these provisions would restrict our ability to sell a property, which could reduce the amount of cash available for distribution to our stockholders.

Competition from other apartment communities for residents could reduce our profitability and the return on your investment.

The apartment sector is highly competitive. This competition could reduce occupancy levels and revenues at our apartment communities, which would adversely affect our operations. We expect to face competition from many sources. We will face competition from other apartment communities both in the immediate vicinity and in the larger geographic market where our apartment communities are located. These competitors may have greater experience and financial resources than us giving them an advantage in attracting residents to their properties. In addition, increases in operating costs due to inflation may not be offset by increased apartment rental rates.

Increased competition and increased affordability of single-family homes could limit our ability to retain residents, lease apartment homes or increase or maintain rents.

Any apartment communities we may acquire will most likely compete with numerous housing alternatives in attracting residents, including single-family homes, as well as owner occupied single- and multifamily homes available to rent. Competitive housing in a particular area and the increasing affordability of owner occupied single- and multifamily homes available to rent or buy caused by declining mortgage interest rates and government programs to promote home ownership could adversely affect our ability to retain our residents, lease apartment homes and increase or maintain rental rates.

Short-term apartment leases expose us to the effects of declining market rent, which could adversely impact our ability to make cash distributions to our stockholders.

Substantially all of our apartment leases are for a term of one year or less. Because these leases generally permit the residents to leave at the end of the lease term without penalty, our rental revenues may be impacted by declines in market rents more quickly than if our leases were for longer terms.

Increased construction of similar properties that compete with our apartment communities in any particular location could adversely affect the operating results of our properties and our cash available for distribution to our stockholders.

We may have acquired apartment communities in locations that may be experiencing increases in the construction of properties that compete with our apartment communities. This increased competition and construction could:

• make it more difficult for us to find residents to lease apartment homes in our apartment communities;

• force us to lower our rental prices in order to lease apartment homes in our apartment communities; and/or

• substantially reduce our revenues and cash available for distribution to our stockholders.

Our leases with commercial tenants at some of our properties are short-term leases, which may result in increased operating expenses if those tenants vacate their space and we are forced to locate new tenants.

A portion of our portfolio of real property investments is comprised of properties with commercial tenants. The leases for these commercial tenants are short-term leases, ranging from one to five year terms. Short-term leases are generally less desirable than long-term leases because long-term leases provide a more predictable income stream over a longer period. Long-term leases also make it easier for us to obtain longer-term, fixed-rate mortgage financing with principal amortization, thereby moderating the interest rate risk associated with financing or refinancing our real properties portfolio by reducing the outstanding principal balance over time. Short-term commercial leases at our properties increase the risk of an extended vacancy due to the difficulty we may experience in finding new tenants upon the expiration of the leases. Additionally, we may incur significant costs related to leasing commissions and tenant improvements to attract new tenants. To the extent that a portion of our real estate portfolio is leased under the terms of short-term leases, we will be subject to the risks of a less predictable income stream and greater exposure to the fluctuations in market rental rates. We will also be subject to interest rate risks should the short-term leases result in a mismatch with any long-term mortgage financing on the real properties.

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Our real properties will be subject to property taxes that may increase in the future, which could adversely affect our cash flow.

Our real properties are subject to real and personal property taxes that may increase as tax rates change and as the real properties are assessed or reassessed by taxing authorities. While certain of our leases, such as leases at our multifamily properties, will generally provide that we are responsible for the property taxes, or increases therein, our commercial leases may provide that such taxes are charged to the lessees as an expense related to the real properties that they occupy. In any case, as the owner of the properties, we are ultimately responsible for payment of the taxes to the applicable government authorities. If we fail to pay any such taxes, the applicable taxing authority may place a lien on the real property and the real property may be subject to a tax sale. In addition, we will generally be responsible for real property taxes related to any vacant space.

Uninsured losses or premiums for insurance coverage relating to real property may adversely affect your returns.

We will attempt to adequately insure all of our real properties against casualty losses. The nature of the activities at certain properties we may acquire, such as age-restricted communities, may expose us and our operators to potential liability for personal injuries and property damage claims. In addition, there are types of losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, floods, hurricanes, pollution or environmental matters that are uninsurable or not economically insurable, or may be insured subject to limitations, such as large deductibles or co-payments. Risks associated with potential acts of terrorism could sharply increase the premiums we pay for coverage against property and casualty claims. Mortgage lenders sometimes require commercial property owners to purchase specific coverage against acts of terrorism as a condition for providing mortgage loans. These policies may not be available at a reasonable cost, if at all, which could inhibit our ability to finance or refinance our real properties. In such instances, we may be required to provide other financial support, either through financial assurances or self-insurance, to cover potential losses. Changes in the cost or availability of insurance could expose us to uninsured casualty losses. In the event that any of our real properties incurs a casualty loss that is not fully covered by insurance, the value of our assets will be reduced by any such uninsured loss. In addition, we cannot assure you that funding will be available to us for repair or reconstruction of damaged real property in the future.

Costs of complying with governmental laws and regulations related to environmental protection and human health and safety may be high.

All real property investments and the operations conducted in connection with such investments are subject to federal, state and local laws and regulations relating to environmental protection and human health and safety. Some of these laws and regulations may impose joint and several liability on customers, owners or operators for the costs to investigate or remediate contaminated properties, regardless of fault or whether the acts causing the contamination were legal.

Under various federal, state and local environmental laws, a current or previous owner or operator of real property may be liable for the cost of removing or remediating hazardous or toxic substances on such real property. These environmental laws often impose liability whether or not the owner or operator knew of, or was responsible for, the presence of such hazardous or toxic substances. In addition, the presence of hazardous substances, or the failure to properly remediate these substances, may adversely affect our ability to sell, rent or pledge such real property as collateral for future borrowings. Environmental laws also may impose restrictions on the manner in which real property may be used or businesses may be operated. Some of these laws and regulations have been amended so as to require compliance with new or more stringent standards as of future dates. Compliance with new or more stringent laws or regulations or stricter interpretation of existing laws may require us to incur material expenditures. Future laws, ordinances or regulations may impose material environmental liability. Additionally, our tenants’ operations, the existing condition of land when we buy it, operations in the vicinity of our real properties, such as the presence of underground storage tanks, or activities of unrelated third parties, may affect our real properties. There are also various local, state and federal fire, health, life-safety and similar regulations with which we may be required to comply and which may subject us to liability in the form of fines or damages for noncompliance. In connection with the acquisition and ownership of our real properties, we may be exposed to these costs in connection with such regulations. The cost of defending against environmental claims, any damages or fines we must pay, compliance with environmental regulatory requirements or remediating any contaminated real property could materially and adversely affect our business and results of operations, lower the value of our assets and, consequently, lower the amounts available for distribution to our stockholders.

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The costs associated with complying with the Americans with Disabilities Act may reduce the amount of cash available for distribution to our stockholders.

Investment in real properties may also be subject to the Americans with Disabilities Act of 1990, as amended, or the ADA. Under the ADA, all places of public accommodation are required to comply with federal requirements related to access and use by disabled persons. We are committed to complying with the ADA to the extent to which it applies. The ADA has separate compliance requirements for “public accommodations” and “commercial facilities” that generally require that buildings and services be made accessible and available to people with disabilities. With respect to the properties we acquire, the ADA’s requirements could require us to remove access barriers and could result in the imposition of injunctive relief, monetary penalties or, in some cases, an award of damages. We will attempt to acquire properties that comply with the ADA or place the burden on the seller or other third party, such as a tenant, to ensure compliance with the ADA. We cannot assure you that we will be able to acquire properties or allocate responsibilities in this manner. Any monies we use to comply with the ADA will reduce the amount of cash available for distribution to our stockholders.

To the extent we invest in age-restricted communities, we may incur liability by failing to comply with the Housing for Older Persons Act, or HOPA, the Fair Housing Act, or FHA, or certain state regulations, which may affect cash available for distribution to our stockholders.

To the extent we invest in age-restricted communities, any such properties must comply with the FHA and the HOPA. The FHA generally prohibits age-based housing discrimination; however certain exceptions exist for housing developments that qualify as housing for older persons. HOPA provides the legal requirements for such housing developments. In order for housing to qualify as housing for older persons, HOPA requires (1) all residents of such developments to be at least 62 years of age or (2) that at least 80% of the occupied apartment homes are occupied by at least one person who is at least 55 years of age and that the housing community publish and adhere to policies and procedures that demonstrate this required intent and comply with rules issued by the United States Department of Housing and Urban Development, or HUD, for verification of occupancy. In addition, certain states require that age-restricted communities register with the state. Noncompliance with the FHA, HOPA or state registration requirements could result in the imposition of fines, awards of damages to private litigants, payment of attorneys’ fees and other costs to plaintiffs, substantial litigation costs and substantial costs of remediation, all of which would reduce the amount of cash available for distribution to our stockholders.

Government housing regulations may limit the opportunities at some of the government-assisted housing properties we invest in, and failure to comply with resident qualification requirements may result in financial penalties and/or loss of benefits, such as rental revenues paid by government agencies.

To the extent that we invest in government-assisted housing, we may acquire properties that benefit from governmental programs intended to provide affordable housing to individuals with low or moderate incomes. These programs, which are typically administered by HUD or state housing finance agencies, typically provide mortgage insurance, favorable financing terms, tax credits or rental assistance payments to property owners. As a condition of the receipt of assistance under these programs, the properties must comply with various requirements, which typically limit rents to pre-approved amounts and impose restrictions on resident incomes. Failure to comply with these requirements and restrictions may result in financial penalties or loss of benefits. In addition, we will typically need to obtain the approval of HUD in order to acquire or dispose of a significant interest in or manage a HUD-assisted property.

Risks Associated with Real Estate-Related Assets

Disruptions in the financial markets and deteriorating economic conditions could adversely impact the commercial mortgage market as well as the market for real estate-related assets and debt-related investments generally, which could hinder our ability to implement our business strategy and generate returns to our stockholders.

Our portfolio is comprised of real estate-related assets. The returns available to investors in these investments are determined by: (1) the supply and demand for such investments; and (2) the existence of a market for such investments, which includes the ability to sell or finance such investments.

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During periods of volatility the number of investors participating in the market may change at an accelerated pace. As liquidity or “demand” increases the returns available to investors will decrease. Conversely, a lack of liquidity will cause the returns available to investors to increase. Concerns pertaining to the deterioration of credit in the residential mortgage market may adversely impact almost all areas of the debt capital markets including corporate bonds, asset-backed securities and commercial real estate bonds and loans. Future instability in the financial markets or weakened economic conditions may interfere with the successful implementation of our business strategy.

If we make or invest in mortgage loans, our mortgage loans may be affected by unfavorable real estate market conditions and other factors that impact the commercial real estate underlying the mortgage loans, which could decrease the value of those loans and the return on your investment.

If we make or invest in mortgage loans, we will be at risk of defaults by the borrowers on those mortgage loans. These defaults may be caused by many conditions beyond our control, including interest rate levels, economic conditions affecting real estate values and other factors that impact the value of the underlying real estate, including those associated with the financial condition of the tenants leasing the underlying real properties and expenditures associated with the early termination or non-renewal of a lease, such as tenant improvement costs and leasing commissions. The borrower may also be subject to tenant roll concentration, in which there are significant leases that terminate in a given year and increase the uncertainty of the future cash flow of the property to the borrower and ultimately to us as the holder of the mortgage in the event the borrower defaults. We will not know whether the values of the properties securing our mortgage loans will remain at the levels existing on the dates of origination of those mortgage loans. If the values of the underlying properties decrease, our risk will increase because of the lower value of the security associated with such loans.

Real estate loans in which we may invest will be secured by multifamily or commercial properties and are subject to risks of delinquency and foreclosure. The ability of a borrower to repay a loan secured by an income-producing property typically is dependent primarily upon the successful operation of such property rather than upon the existence of independent income or assets of the borrower. If the net operating income of the property is reduced, the borrower’s ability to repay the loan may be impaired. Net operating income of an income-producing property can be affected by, among other things: tenant mix, success of tenant businesses, property management decisions, property location and condition, competition from comparable types of properties, changes in laws that increase operating expenses or limit rents that may be charged, any need to address environmental contamination at the property, the occurrence of any uninsured casualty at the property, changes in national, regional or local economic conditions and/or specific industry segments, declines in regional or local real estate values, declines in regional or local rental or occupancy rates, increases in interest rates, real estate tax rates and other operating expenses, changes in governmental rules, regulations and fiscal policies, including environmental legislation, natural disasters, terrorism, social unrest and civil disturbances. Any of these events could have an adverse effect on the operations of the underlying property and ability of a borrower to repay the loan.

If we make or invest in mortgage loans, our mortgage loans will be subject to interest rate fluctuations that could reduce our returns as compared to market interest rates and reduce the value of the mortgage loans in the event we sell them.

If we invest in fixed-rate, long-term mortgage loans and interest rates rise, the mortgage loans could yield a return that is lower than then-current market rates and the value of the loan may decline. If interest rates decrease, we will be adversely affected to the extent that mortgage loans are prepaid because we may not be able to make new loans at the higher interest rate. If we invest in variable-rate loans and interest rates decrease, our revenues and the value of the loan will also decrease. For these reasons, if we invest in mortgage loans, our returns on those loans and the value of your investment will be subject to fluctuations in interest rates.

Many of our investments in real estate-related assets may be illiquid, and we may not be able to vary our portfolio in response to changes in economic and other conditions.

Certain of the real estate-related assets that we may purchase in connection with privately negotiated transactions will not be registered under the relevant securities laws, resulting in a prohibition against their transfer, sale, pledge or other disposition except in a transaction that is exempt from the registration requirements of, or is otherwise in accordance with, those laws. The mezzanine and bridge loans we may purchase would be particularly illiquid investments due to their short life, their unsuitability for securitization and the greater difficulty of recoupment in the event of a borrower’s default. As a result, our ability to vary our portfolio in response to changes in economic and other conditions may be relatively limited.

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The mezzanine loans in which we may invest would involve greater risks of loss than senior loans secured by income-producing real properties.

We may invest in mezzanine loans that take the form of subordinated loans secured by second mortgages on the underlying real property or loans secured by a pledge of the ownership interests of the entity owning the real property, the entity that owns the interest in the entity owning the real property or other assets. These types of investments involve a higher degree of risk than long-term senior mortgage lending secured by income-producing real property because the investment may become unsecured as a result of foreclosure by the senior lender. In the event of a bankruptcy of the entity providing the pledge of its ownership interests as security, we may not have full recourse to the assets of such entity, or the assets of the entity may not be sufficient to satisfy our mezzanine loan. If a borrower defaults on our mezzanine loan or debt senior to our mezzanine loan, or in the event of a borrower bankruptcy, our mezzanine loan will be satisfied only after the senior debt. As a result, we may not recover some or all of our investment. In addition, mezzanine loans will have higher loan-to-value ratios than conventional mortgage loans, resulting in less equity in the real property and increasing the risk of loss of principal and interest.

Bridge loans may involve a greater risk of loss than conventional mortgage loans.

We may provide bridge loans secured by first-lien mortgages on properties to borrowers who are typically seeking short-term capital to be used in an acquisition, development or refinancing of real estate. The borrower may have identified an undervalued asset that has been undermanaged or is located in a recovering market. If the market in which the asset is located fails to recover according to the borrower’s projections, or if the borrower fails to improve the quality of the asset’s management or the value of the asset, the borrower may not receive a sufficient return on the asset to satisfy the bridge loan, and we may not recover some or all of our investment. In addition, owners usually borrow funds under a conventional mortgage loan to repay a bridge loan. We may, therefore, be dependent on a borrower’s ability to obtain permanent financing to repay our bridge loan, which could depend on market conditions and other factors. Bridge loans are also subject to risks of borrower defaults, bankruptcies, fraud, losses and special hazard losses that are not covered by standard hazard insurance. In the event of any default under bridge loans held by us, we bear the risk of loss of principal and nonpayment of interest and fees to the extent of any deficiency between the value of the mortgage collateral and the principal amount of the bridge loan. To the extent we suffer such losses with respect to our investments in bridge loans, the value of our company and of our common stock may be adversely affected.

Our real estate-related assets may be sensitive to fluctuations in interest rates, and our hedging strategies may not be effective.

We may use various investment strategies to hedge interest rate risks with respect to our portfolio of real estate-related assets. The use of interest rate hedging transactions involves certain risks. These risks include: (1) the possibility that the market will move in a manner or direction that would have resulted in gain for us had an interest rate hedging transaction not been utilized, in which case our performance would have been better had we not engaged in the interest rate hedging transaction; (2) the risk of imperfect correlation between the risk sought to be hedged and the interest rate hedging transaction used; (3) potential illiquidity for the hedging instrument used, which may make it difficult for us to close-out or unwind an interest rate hedging transaction; and (4) the possibility that the counterparty fails to honor its obligation. In addition, because we have elected to be taxed as a REIT under the Internal Revenue Code beginning with the taxable year ending December 31, 2010, for federal income tax purposes we will have limitations on our income sources and the hedging strategies available to us will be more limited than those available to companies that are not REITs. To the extent that we do not hedge our interest rate exposure, our profitability may be negatively impacted by changes in long-term interest rates.

Declines in the market values of the real estate-related assets in which we invest may adversely affect our periodic reported results of operations and credit availability, which may reduce earnings and, in turn, cash available for distribution to our stockholders.

A portion of the real estate-related assets may be classified for accounting purposes as “held-for-sale.” These investments are carried at the lower of carrying value and or estimated fair value less cost to sell. If these investments are carried at estimated fair value and temporary changes in the market values of those assets will be directly charged or credited to stockholders’ equity without impacting net income on our income statement. Market values of our investments may decline for a number of reasons, such as market illiquidity, changes in prevailing market rates, increases in defaults, increases in voluntary prepayments for those of our investments that are subject to prepayment risk, widening of credit spreads and downgrades of

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ratings of the securities by ratings agencies. If we determine that a decline in the estimated fair value of an available-for-sale security below its amortized value is other-than-temporary, we will recognize a loss on that security in our income statement, which will reduce our earnings in the period recognized.

A decline in the market value of our real estate-related assets may adversely affect us particularly in instances where we have borrowed money based on the market value of those assets. If the market value of those assets declines, the lender may require us to post additional collateral to support the loan. If we were unable to post the additional collateral, we may have to sell assets at a time when we might not otherwise choose to do so. A reduction in credit available may reduce our earnings and, in turn, cash available for distribution to stockholders. Further, credit facility providers may require us to maintain a certain amount of cash reserves or to set aside unlevered assets sufficient to maintain a specified liquidity position. As a result, we may not be able to leverage our assets as fully as we would choose, which could reduce our return on equity. In the event that we are unable to meet these contractual obligations, our financial condition could deteriorate rapidly.

Some of the real estate-related assets in which we invest will be carried at estimated fair value as determined by us and, as a result, there may be uncertainty as to the value of these investments.

Some of the real-estate-related assets in which we invest may be in the form of securities that are recorded at fair value but that have limited liquidity or are not publicly traded. The fair value of securities and other investments that have limited liquidity or are not publicly traded may not be readily determinable. We estimate the fair value of these investments on a quarterly basis. Because such valuations are inherently uncertain, may fluctuate over short periods of time and may be based on numerous estimates, our determinations of fair value may differ materially from the values that would have been used if a ready market for these securities existed. The value of our common stock could be adversely affected if our determinations regarding the fair value of these investments are materially higher than the values that we ultimately realize upon their disposal.

Risks Associated With Debt Financing

We will incur mortgage indebtedness and other borrowings which increase our business risks and could hinder our ability to make distributions and decrease the value of your investment.

We financed a portion of the purchase price of our real properties by borrowing funds. In addition, we have entered into a $35 million credit facility with PNC Bank, National Association. We may continue to incur mortgage debt and pledge some or all of our investments as security for that debt to obtain funds to acquire additional investments or for working capital. We may also borrow funds as necessary or advisable to ensure we maintain our REIT tax qualification, including the requirement that we distribute at least 90% of our annual REIT taxable income to our stockholders (computed without regard to the distribution paid deduction and excluding net capital gains). However, there is no assurance that we will be able to obtain such borrowings on satisfactory terms.

High debt levels will cause us to incur higher interest charges, which would result in higher debt service payments and could be accompanied by restrictive covenants. If there is a shortfall between the cash flow from a property and the cash flow needed to service mortgage debt on that property, then the amount available for distributions to stockholders may be reduced. In addition, incurring mortgage debt increases the risk of loss since defaults on indebtedness secured by a property may result in lenders initiating foreclosure actions. In that case, we could lose the property securing the loan that is in default, thus reducing the value of your investment. For tax purposes, a foreclosure on any of our properties will be treated as a sale of the property for a purchase price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds our tax basis in the property, we will recognize taxable income on foreclosure, but we would not receive any cash proceeds. If any mortgage contains cross collateralization or cross default provisions, a default on a single property could affect multiple properties. If any of our properties are foreclosed upon due to a default, our ability to pay cash distributions to our stockholders will be adversely affected.

Instability in the debt markets and our inability to find financing on attractive terms may make it more difficult for us to finance or refinance properties, and could reduce the amount of cash distributions we can make to our stockholders.

If mortgage debt is unavailable on reasonable terms as a result of increased interest rates, underwriting standards, capital market instability or other factors, we run the risk of being unable to refinance such debt when the loans come due, or of being unable to refinance on favorable terms, to the extent that we place mortgage debt on properties. If interest rates are higher when

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we refinance debt, our income could be reduced. We may be unable to refinance debt at appropriate times, which may require us to sell properties on terms that are not advantageous to us, or could result in the foreclosure of such properties. If any of these events occur, our cash flow would be reduced. This, in turn, would reduce cash available for distribution to our stockholders and may hinder our ability to raise more capital by issuing securities or by borrowing more money.

Increases in interest rates could increase the amount of our debt payments and negatively impact our operating results.

Interest we pay on our debt obligations reduces our cash available for distributions. Utilization of variable rate debt, combined with increases in interest rates would increase our interest costs, which would reduce our cash flows and our ability to make distributions to our stockholders. If we need to repay existing debt during periods of rising interest rates, we could be required to liquidate one or more of our investments at times which may not permit realization of the maximum return on such investments.

Lenders may require us to enter into restrictive covenants relating to our operations, which could limit our ability to make distributions to our stockholders.

When providing financing, a lender may impose restrictions on us that affect our distribution and operating policies and our ability to incur additional debt. Loan documents we enter into may contain covenants that limit our ability to further mortgage a property, discontinue insurance coverage, or replace our advisor. In addition, loan documents may limit our ability to replace a property’s property manager or terminate certain operating or lease agreements related to a property. These or other limitations may adversely affect our flexibility and our ability to achieve our investment objectives.

The derivative financial instruments that we may use to hedge against interest rate fluctuations may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on your investment.

We may use derivative financial instruments, such as interest rate cap or collar agreements and interest rate swap agreements, to hedge exposures to changes in interest rates on loans secured by our assets, but no hedging strategy can protect us completely. These agreements involve risks, such as the risk that counterparties may fail to honor their obligations under these arrangements and that these arrangements may not be effective in reducing our exposure to interest rate changes. We cannot assure you that our hedging strategy and the derivatives that we use will adequately offset the risk of interest rate volatility or that our hedging transactions will not result in losses. In addition, the use of such instruments may reduce the overall return on our investments. These instruments may also generate income that may not be treated as qualifying REIT income for purposes of the 75% or 95% REIT gross income tests.

Federal Income Tax Risks

Failure to qualify as a REIT would reduce our net earnings available for investment or distribution.

If we fail to qualify as a REIT for any taxable year and we do not qualify for certain statutory relief provisions, we will be subject to federal income tax on our taxable income at corporate rates. In addition, we would generally be disqualified from treatment as a REIT for the four taxable years following the year of losing our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution to stockholders because of the additional tax liability. In addition, distributions to stockholders would no longer qualify for the dividends paid deduction and we would no longer be required to make distributions. If this occurs, we might be required to borrow funds or liquidate some investments in order to pay the applicable tax.

You may have current tax liability on distributions you elect to reinvest in our common stock.

If you participate in our distribution reinvestment plan, you will be deemed to have received, and for income tax purposes will be taxed on, the amount reinvested in shares of our common stock to the extent the amount reinvested was not a tax-free return of capital. In addition, you will be treated for tax purposes as having received an additional distribution to the extent the shares are purchased at a discount to fair market value. As a result, unless you are a tax-exempt entity, you may have to use funds from other sources to pay your tax liability on the value of the shares of common stock received.

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Even if we qualify as a REIT for federal income tax purposes, we may be subject to other tax liabilities that reduce our cash flow and our ability to make distributions to you.

Even if we qualify as a REIT for federal income tax purposes, we may be subject to some federal, state and local taxes on our income or property. For example:

• In order to qualify as a REIT, we must distribute annually at least 90% of our REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain for this purpose) to our stockholders. To the extent that we satisfy the distribution requirement but distribute less than 100% of our REIT taxable income, we will be subject to federal corporate income tax on the undistributed income.

• We will be subject to a 4% nondeductible excise tax on the amount, if any, by which distributions we pay in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from prior years.

• If we have net income from the sale of foreclosure property that we hold primarily for sale to customers in the ordinary course of business or other non-qualifying income from foreclosure property, we must pay a tax on that income at the highest corporate income tax rate.

• If we sell an asset, other than foreclosure property, that we hold primarily for sale to customers in the ordinary course of business, our gain would be subject to the 100% “prohibited transaction” tax unless such sale were made by one of our taxable REIT subsidiaries.

REIT distribution requirements could adversely affect our ability to execute our business plan.

We generally must distribute annually at least 90% of our REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain for this purpose) in order to qualify as a REIT. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our REIT taxable income (including net capital gain), we will be subject to federal corporate income tax on our undistributed REIT taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under federal tax laws. We intend to make distributions to our stockholders to comply with the REIT requirements of the Internal Revenue Code.

From time to time, we may generate taxable income greater than our taxable income for financial reporting purposes, or our taxable income may be greater than our cash flow available for distribution to stockholders. If we do not have other funds available in these situations we could be required to borrow funds, sell investments at disadvantageous prices or find another alternative source of funds to make distributions sufficient to enable us to pay out enough of our taxable income to satisfy the REIT distribution requirement and to avoid corporate income tax and the 4% excise tax in a particular year. There is no assurance that outside financing will be available to us. Even if available, the use of outside financing or other alternative sources of funds to pay distributions could increase our costs or dilute our stockholders’ equity interests. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

To maintain our REIT status, we may be forced to forgo otherwise attractive opportunities, which may delay or hinder our ability to meet our investment objectives and reduce your overall return.

To maintain our REIT status, we must satisfy certain tests on an ongoing basis concerning, among other things, the sources of our income, nature of our assets and the amounts we distribute to our stockholders. We may be required to make distributions to stockholders at times when it would be more advantageous to reinvest cash in our business or when we do not have funds readily available for distribution. Compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits and the value of your investment.

Our gains from sales of our assets are potentially subject to the prohibited transaction tax, which could reduce the return on your investment.

Our ability to dispose of property during the first few years following acquisition is restricted to a substantial extent as a result of our REIT status. We will be subject to a 100% tax on any gain realized on the sale or other disposition of any property (other than foreclosure property) we own, directly or through any subsidiary entity, including our operating partnership, but excluding our taxable REIT subsidiaries, that is deemed to be inventory or property held primarily for sale to customers in the

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ordinary course of trade or business. Whether property is inventory or otherwise held primarily for sale to customers in the ordinary course of a trade or business depends on the particular facts and circumstances surrounding each property. We intend to avoid the 100% prohibited transaction tax by (1) conducting activities that may otherwise be considered prohibited transactions through a taxable REIT subsidiary, (2) conducting our operations in such a manner so that no sale or other disposition of an asset we own, directly or through any subsidiary other than a taxable REIT subsidiary, will be treated as a prohibited transaction or (3) structuring certain dispositions of our properties to comply with certain safe harbors available under the Internal Revenue Code for properties held at least two years. However, no assurance can be given that any particular property we own, directly or through any subsidiary entity, including our operating partnership, but excluding our taxable REIT subsidiaries, will not be treated as inventory or property held primarily for sale to customers in the ordinary course of a trade or business.

Complying with REIT requirements may force us to liquidate otherwise attractive investments.

To maintain our REIT status, we must ensure that at the end of each calendar quarter, at least 75% of the value of our assets consists of cash, cash items, government securities and qualifying real estate assets, including certain mortgage loans and mortgage-backed securities. The remainder of our investment in securities (other than government securities and qualified real estate assets) generally cannot include more than 10% of the outstanding voting securities of any one issuer or more than 10% of the total value of the outstanding securities of any one issuer. In addition, in general, no more than 5% of the value of our assets (other than government securities and qualified real estate assets) can consist of the securities of any one issuer, and no more than 25% of the value of our total assets can be represented by securities of one or more taxable REIT subsidiaries.

If we fail to comply with these requirements at the end of any calendar quarter, we must correct the failure within 30 days after the end of the calendar quarter or qualify for certain statutory relief provisions to avoid losing our REIT qualification and suffering adverse tax consequences. As a result, we may be required to liquidate from our portfolio otherwise attractive investments. These actions could have the effect of reducing our income and amounts available for distribution to our stockholders.

Liquidation of assets may jeopardize our REIT status.

To maintain our REIT status, we must comply with requirements regarding our assets and our sources of income. If we are compelled to liquidate our investments to repay obligations to our lenders, we may be unable to comply with these requirements, ultimately jeopardizing our qualification as a REIT, or we may be subject to a 100% tax on any resultant gain if we sell assets that are treated as dealer property or inventory.

The failure of a mezzanine loan to qualify as a real estate asset could adversely affect our ability to qualify as a REIT.

We may acquire mezzanine loans. The Internal Revenue Service has provided a safe harbor in Revenue Procedure 2003-65 for structuring mezzanine loans so that they will be treated by the Internal Revenue Service as a real estate asset for purposes of the REIT asset tests, and interest derived from mezzanine loans will be treated as qualifying mortgage interest for purposes of the 75% gross income test, as discussed below. Although the Revenue Procedure provides a safe harbor on which taxpayers may rely, it does not prescribe rules of substantive tax law. We may acquire mezzanine loans that do not meet all of the requirements of the safe harbor. In the event we own a mezzanine loan that does not meet the safe harbor, the Internal Revenue Service could challenge such loan’s treatment as a real estate asset for purposes of the REIT asset and income tests and, if such a challenge were sustained, we could fail to continue to qualify as a REIT.

Legislative or regulatory action could adversely affect investors.

In recent years, numerous legislative, judicial and administrative changes have been made to the federal income tax laws applicable to investments in REITs and similar entities. Additional changes to tax laws are likely to continue to occur in the future and we cannot assure you that any such changes will not adversely affect the taxation of a stockholder. Any such changes could have an adverse effect on an investment in shares of our common stock. We urge you to consult with your own tax advisor with respect to the status of legislative, regulatory or administrative developments and proposals and their potential effect on an investment in shares of our common stock.

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Non-U.S. investors may be subject to FIRPTA on the sale of shares of our common stock if we are unable to qualify as a “domestically controlled qualified investment entity.”

A non-U.S. person disposing of a U.S. real property interest, including shares of a U.S. corporation whose assets consist principally of U.S. real property interests, is generally subject to a tax, known as FIRPTA, on the gain recognized on the disposition of such interest. FIRPTA does not apply, however, to the disposition of stock in a REIT if the REIT is a “domestically controlled qualified investment entity.” A REIT is a domestically controlled qualified investment entity if, at all times during a specified testing period (the continuous five year period ending on the date of disposition or, if shorter, the entire period of the REIT’s existence), less than 50% in value of its shares is held directly or indirectly by non-U.S. holders. We cannot assure you that we will qualify as a domestically controlled qualified investment entity. If we were to fail to so qualify, gain realized by a non-U.S. investor on a sale of our common stock would be subject to FIRPTA unless our common stock was traded on an established securities market and the non-U.S. investor did not at any time during a specified testing period directly or indirectly own more than 5% of the value of our outstanding common stock.

Retirement Plan Risks

If you fail to meet the fiduciary and other standards under ERISA or the Internal Revenue Code as a result of an investment in our stock, you could be subject to criminal and civil penalties.

There are special considerations that apply to employee benefit plans subject to the Employee Retirement Income Security Act of 1974, or ERISA, (such as pension, profit-sharing or 401(k) plans) and other retirement plans or accounts subject to Section 4975 of the Internal Revenue Code (such as an IRA or Keogh plan) whose assets are being invested in our common stock. If you are investing the assets of such a plan (including assets of an insurance company general account or entity whose assets are considered plan assets under ERISA) or account in our common stock, you should satisfy yourself that:

• your investment is consistent with your fiduciary obligations under ERISA and the Internal Revenue Code;

• your investment is made in accordance with the documents and instruments governing your plan or IRA, including your plan or account’s investment policy;

• your investment satisfies the prudence and diversification requirements of Section 404(a)(1)(B) and 404(a)(1)(C) of ERISA and other applicable provisions of ERISA and/or the Internal Revenue Code;

• your investment will not impair the liquidity of the plan or IRA;

• your investment will not produce unrelated business taxable income, referred to as UBTI, for the plan or IRA;

• you will be able to value the assets of the plan annually in accordance with ERISA requirements and applicable provisions of the plan or IRA; and

• your investment will not constitute a prohibited transaction under Section 406 of ERISA or Section 4975 of the Internal Revenue Code.

Failure to satisfy the fiduciary standards of conduct and other applicable requirements of ERISA and the Internal Revenue Code may result in the imposition of civil and criminal penalties and could subject the fiduciary to equitable remedies. In addition, if an investment in our common stock constitutes a prohibited transaction under ERISA or the Internal Revenue Code, the fiduciary that authorized or directed the investment may be subject to the imposition of excise taxes with respect to the amount invested.

ITEM 1B. UNRESOLVED STAFF COMMENTS

We have no unresolved staff comments.

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ITEM 2. PROPERTIES

As of December 31, 2014, we owned 65 multifamily properties consisting of an aggregate of 16,526 multifamily homes and 25,973 square feet of rentable office space. The total cost of our real estate portfolio as of December 31, 2014 was $1,624,892,557, exclusive of closing costs. For additional information on our real estate portfolio, see Part I, Item 1. “Business—Our Real Estate Portfolio” of this Annual Report on Form 10-K.

Our principal executive offices are located at 18100 Von Karman Avenue, Suite 500, Irvine, CA 92612. Our telephone number, general facsimile number and website address are (949) 852-0700, (949) 852-0143 and http://www.steadfastreits.com, respectively.

ITEM 3. LEGAL PROCEEDINGS

From time to time, we are party to legal proceedings that arise in the ordinary course of our business. Management is not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on our results of operations or financial condition, nor are we aware of any such legal proceedings contemplated by government agencies.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND PURCHASES OF EQUITY SECURITIES

Stockholder Information

As of March 10, 2015, we had approximately 76.9 million shares of common stock outstanding held by a total of approximately 19,000 stockholders. The number of stockholders is based on the records of DST Systems, Inc., who serves as our transfer agent.

Market Information

No public market currently exists for our shares of common stock and we currently have no plans to list our shares on a national securities exchange. Until our shares are listed, if ever, our stockholders may not sell their shares unless the buyer meets the applicable suitability and minimum purchase requirements. In addition, our charter prohibits the ownership of more than 9.8% in value of our outstanding capital stock (which includes common stock and preferred stock we may issue) and more than 9.8% in value or number of shares, whichever is more restrictive, of our outstanding common stock, unless exempted by our board of directors. Consequently, there is the risk that our stockholders may not be able to sell their shares at a time or price acceptable to them.

Estimated Value Per Share

Background

In December 2014, our board of directors initiated a process to determine an estimated value per share of the shares of our common stock. We are providing an estimated value per share to assist broker-dealers that participated in our public offerings in meeting their customer account statement reporting obligations under Financial Industry Regulatory Authority, or FINRA, Rule 5110. This valuation was performed in accordance with Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Investment Program Association, or IPA, in April 2013, or the IPA valuation guidelines. Our board

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of directors formed a valuation committee to oversee the process of determining our estimated value per share. The valuation committee is comprised solely of independent directors. On the approval of the board of directors, we engaged CBRE Capital Advisors, Inc., or CBRE Cap, an investment banking firm that specializes in providing real estate financial services, to provide property-level and aggregate valuation analyses and a range for the estimated value per share of our common stock as of December 31, 2014.

From CBRE Cap’s engagement through the issuance of its valuation report on March 10, 2015, or the valuation report, CBRE Cap held discussions with our advisor and our senior management and conducted or commissioned such investigations, research, review and analyses as it deemed necessary. CBRE Cap based its calculation of the range in estimated value per share of our common stock as of December 31, 2014 upon appraisals of all our real properties performed by CBRE, Inc., or CBRE, an affiliate of CBRE Cap and an independent third party appraisal firm, and valuations performed by our advisor with respect to our other assets and liabilities. The valuation committee, upon its receipt and review of the valuation report, concluded that the range of between $9.73 and $11.02 for our estimated value per share proposed in CBRE Cap’s valuation report was reasonable and recommended to the board of directors that it adopt $10.35 as the estimated value per share of our common stock as of December 31, 2014. On March 10, 2015, our board of directors accepted the recommendation of the valuation committee and approved $10.35 as the estimated value per share of our common stock as of December 31, 2014. CBRE Cap is not responsible for the determination of the estimated value per share of our common stock as of December 31, 2014.

Valuation Methodology

In preparing the valuation report, CBRE Cap, among other things:

• reviewed financial and operating information requested from or provided by our advisor and us;

• reviewed and discussed with us and our advisor the historical and anticipated future financial performance of our multifamily properties, including forecasts prepared by us and our advisor;

• reviewed appraisals commissioned by us which contained analysis on each of our multifamily properties and performed analyses and studies for each property;

• conducted or reviewed CBRE Cap proprietary research, including market and sector capitalization rate surveys;

• reviewed third-party research, including equity reports and online data providers;

• compared our financial information to similar information of companies that CBRE Cap deemed to be comparable; and

• reviewed our reports filed with the SEC, including this Annual Report on Form 10-K for the fiscal year ended December 31, 2014, and the audited financial statements contained herein, and our Quarterly Report on Form 10-Q for the period ended September 30, 2014, and the unaudited financial statements therein.

Member of Appraisal Institute (MAI) appraisals of all of our multifamily properties were performed in accordance with Uniform Standards of Professional Appraisal Practice. These appraisals, or appraisals, were prepared by CBRE and prepared by personnel who are members and hold the MAI designation. CBRE Cap reviewed and took into consideration the appraisals of CBRE, and described the results of such appraisals in its valuation report. Discreet values were assigned to each property in our portfolio. CBRE is not responsible for the determination of the estimated value per share of our common stock as of December 31, 2014.

Our board of directors considered the following valuation methodology with respect to each multifamily property, which was applied by CBRE Cap in its valuation report. Unlevered, ten-year discounted cash flow analyses from appraisals were created for our fully operational properties. For non-stabilized properties, lease-up discounts were applied to discounted cash flow to arrive at an “As Is” value. The “terminal capitalization rate” method was used to calculate terminal value of the assets, with such rates varying based on the specific geographic location and other relevant factors.

Valuation Summary: Material Assumptions

The valuation process we used to determine an estimated value per share was designed to follow the recommendations of the IPA in its valuation guideline.

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The following table summarizes the key assumptions that were employed by CBRE Cap in the discounted cash flow models to estimate the value of our real estate assets:

	Range	Weighted-Average
Terminal capitalization rate	6.22% - 6.54%	6.38%
Discount rate	7.46% - 7.85%	7.65%

While we believe that CBRE’s assumptions and inputs are reasonable, a change in these assumptions and inputs would significantly impact the appraised value of the real estate properties and thus, our estimated value per share. The table below illustrates the impact on the estimated value per share if the terminal capitalization rates or discount rates were adjusted by 5% in accordance with the IPA valuation guidelines, assuming all other factors remain unchanged:

	Increase (Decrease) on the Estimated Value per Share due to
	Decrease of 2.5%		Increase of 2.5%
Terminal capitalization rate	$	0.32	$	(0.32	)
Discount rate	0.32		(0.32		)

In its valuation report, CBRE Cap included an estimate of the December 31, 2014 value of our assets, including cash and select other assets net of payables, and accruals and other liabilities including notes payable. The estimated values of our notes payable are equal to the GAAP fair values disclosed in this Annual Report on Form 10-K for the year ended December 31, 2014, but do not equal the book value of the loans in accordance with GAAP. The GAAP fair values of our notes payable were determined using a discounted cash flow analysis. The discounted cash flow analysis was based on projected cash flow over the remaining loan terms and on management’s estimates of current market interest rates for instruments with similar characteristics. The carrying values of a majority of our other assets and liabilities are considered to equal their fair value due to their short term maturities or liquid nature. Certain balances, such as lease intangible assets and liabilities related to real estate investments and deferred financing costs have been eliminated for the purpose of the valuation due to the fact that the value of those balances was already considered in the appraisals of the real estate properties.

Our estimated value per share takes into consideration any potential liability related to an incentive fee our advisor is entitled to upon meeting certain stockholder return thresholds in accordance with our charter. For purposes of determining the estimated value per share, our advisor calculated the potential liability related to this incentive fee based on a hypothetical liquidation of our assets and liabilities at their estimated fair values, after considering the impact of any potential closing costs and fees related to the disposition of real estate properties, and determined that there would be a liability related to the incentive fee of $1,677,351.

Taking into consideration the reasonableness of the valuation methodology, assumptions and conclusions contained in the valuation report, the valuation committee and board of directors determined the estimated value of our equity interest in its real estate portfolio to be in the range of $1,827,926,080 to $1,934,001,051 and the Company’s net asset value to range from between $747,487,582 and $846,974,596, or between $9.73 and $11.02 per share, based on a share count of 76,858,483 shares issued and outstanding as of December 31, 2014.

As with any valuation methodology, the methodologies considered by the valuation committee and board of directors in reaching an estimate of the value of our shares are based upon all of the foregoing estimates, assumptions, judgments and opinions that may, or may not, prove to be correct. The use of different estimates, assumptions, judgments or opinions may have resulted in significantly different estimates of the value of our shares.

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The following table summarizes the material components of our estimated value and estimated value per share as of December 31, 2014.

	December 31, 2014 Estimated Value			December 31, 2014 Estimated Value Per Share
Real estate properties	$	1,877,601,207		$	24.43
Cash	29,529,312			0.38
Other assets	33,693,895			0.44
Mortgage debt	(1,096,414,832		)	(14.27		)
Other liabilities	(47,246,873		)	(0.61		)
Incentive fee	(1,677,351		)	(0.02		)
Estimated value per share	$	795,485,358		$	10.35

Additional Information Regarding the Valuation, Limitations of Estimated Value per Share and the Engagement of CBRE Cap

Throughout the valuation process, the valuation committee, our advisor and our executive officers reviewed, confirmed and approved the processes and methodologies employed by CBRE Cap and their consistency with real estate industry standards and best practices.

The valuation report dated March 10, 2015 was based upon market, economic, financial and other information, circumstances and conditions existing prior to December 31, 2014, and any material change in such information, circumstances and/or conditions may have a material effect on the estimated value per share. CBRE Cap’s valuation materials were addressed solely to our board of directors to assist it in establishing an estimated value of our common stock. CBRE Cap’s valuation materials were not addressed to the public and should not be relied upon by any other person to establish an estimated value of our common stock. The valuation report does not constitute a recommendation by CBRE Cap to purchase or sell any shares of our common stock.

Each of CBRE Cap and CBRE reviewed for reasonableness the information supplied or otherwise made available to it by us or our advisor, and in doing so, assumed and relied upon the accuracy and completeness of all such information and of all information supplied or otherwise made available to it by any other party, and did not undertake any duty or responsibility to verify independently any of such information. With respect to operating or financial forecasts and other information and data provided to or otherwise reviewed by or discussed with CBRE Cap and CBRE, CBRE Cap and CBRE assumed that such forecasts and other information and data were reasonably prepared in good faith on bases reflecting our and our advisor’s best currently available estimates and judgments, and relied upon us and our advisor to advise CBRE Cap and CBRE promptly if any information previously provided became inaccurate or was required to be updated during the period of its review. In preparing its valuation materials, CBRE Cap did not, and was not requested to, solicit third party indications of interest for us in connection with possible purchases of our securities or the acquisition of all or any part of us.

In performing its analyses, CBRE Cap made numerous assumptions as of various points in time with respect to industry performance, general business, economic and regulatory conditions, current and future rental market for our operating properties and those in development and other matters, many of which are necessarily subject to change and beyond the control of CBRE Cap and us. The analyses performed by CBRE Cap are not necessarily indicative of actual values, trading values or actual future results of our common stock that might be achieved, all of which may be significantly more or less favorable than suggested by the valuation report. The analyses do not purport to be appraisals or to reflect the prices at which the properties may actually be sold, and such estimates are inherently subject to uncertainty. The actual value of our common stock may vary significantly depending on numerous factors that generally impact the price of securities, our financial condition and the state of the real estate industry more generally. Accordingly, with respect to the estimated value per share of our common stock, neither we nor CBRE Cap can give any assurance that:

• a stockholder would be able to resell his or her shares at this estimated value;

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• a stockholder would ultimately realize distributions per share equal to our estimated value per share upon liquidation of our assets and settlement of our liabilities or a sale of the Company;

• another independent third party appraiser or third party valuation firm would agree with our estimated value per share;

• a third party would offer the estimated value per share in an arm’s length transaction to purchase all or substantially all of our shares of common stock;

• our shares would trade at a price equal to or greater than the estimated value per share if we listed them on a national securities exchange; or

• the methodology used to estimate our value per share would be acceptable to FINRA or under the Employee Retirement Income Security Act of 1974 (the “ERISA”) for compliance with its reporting requirements.

The December 31, 2014 estimated value per share was determined by our valuation committee and approved by our board of directors at a meeting held on March 10, 2015. The value of our common stock will fluctuate over time as a result of, among other things, developments related to individual assets and responses to the real estate and capital markets. We currently expect to utilize an independent valuation firm to update the estimated value per share in December 2015, in accordance with the IPA valuation guidelines.

The estimated value per share does not reflect a discount for the fact that we are externally managed, nor does it reflect a real estate portfolio premium/discount versus the sum of the individual property values. The estimated value per share does not take into account estimated disposition costs and fees for real estate properties that are not under contract to sell or debt prepayment penalties that could apply upon the prepayment of certain of our debt obligations or the impact of restrictions on the assumption of debt.

CBRE Cap is a FINRA registered broker-dealer and is an investment banking firm that specializes in providing real estate financial services. CBRE is actively engaged in the business of appraising commercial real estate properties similar to those owned by us in connection with public securities offerings, private placements, business combinations and similar transactions. We commissioned CBRE to deliver an appraisal report relating to our real estate properties and CBRE received fees upon delivery of such report. In addition, we have agreed to indemnify CBRE Cap against certain liabilities arising out of this engagement. Each of CBRE Cap and CBRE is an affiliate of CBRE Group, Inc., or the CBRE Group, a Fortune 500 and S&P 500 company headquartered in Los Angeles, California, one of the world’s largest commercial real estate services and investment firms (in terms of 2014 revenue) and a parent holding company of affiliated companies that are engaged in the ordinary course of business in many areas related to commercial real estate and related services. CBRE Cap and its affiliates possess substantial experience in the valuation of assets similar to those owned by us and regularly undertake the valuation of securities in connection with public offerings, private placements, business combinations and similar transactions. For the preparation of the valuation report, we paid CBRE Cap a customary fee for services of this nature, no part of which was contingent relating to the provision of services or specific findings. We have not engaged CBRE Cap for any other services. During the past two years, certain of our affiliates engaged affiliates of CBRE primarily for various real estate-related services and these affiliates of CBRE received fees in connection with such services. In addition, we anticipate that affiliates of CBRE will continue to provide similar or other real estate-related services in the future for us and our affiliates. In addition, we may in our discretion engage CBRE Cap to assist our board of directors in future determinations of our estimated value per share. We are not affiliated with CBRE, CBRE Cap or any of their affiliates. CBRE Cap and CBRE and their affiliates may from time to time in the future perform other commercial real estate appraisal, valuation and financial advisory services for us and our affiliates in transactions related to the properties that are the subjects of the appraisals, so long as such other services do not adversely affect the independence of the applicable CBRE appraiser. While we and affiliates of our advisor have engaged and may engage CBRE Cap or its affiliates in the future for commercial real estate services of various kinds, we believe that there are no material conflicts of interest with respect to our engagement of CBRE Cap.

In the ordinary course of their business, each of CBRE Cap and CBRE, and their respective affiliates, directors and officers may structure and effect transactions for their own accounts or for the accounts of their customers in commercial real estate assets of the same kind and in the same markets as our assets.

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Distribution Information

To qualify and maintain our qualification as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our REIT taxable income (computed without regard to the dividends-paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with U.S. generally accepted accounting principles, or GAAP). Our board of directors may authorize distributions in excess of those required for us to maintain REIT status depending on our financial condition and such other factors as our board of directors deems relevant.

We declared distributions based on daily record dates for each day during the period commencing August 12, 2010 (the day following our first property acquisition) through December 31, 2014. Distributions declared for all record dates of a given month are paid approximately three days after month-end. Distributions are currently calculated at a rate of $0.001964 per share per day, which if paid each day over a 365-day period is equivalent to a 7.0% annualized distribution rate based on a purchase price of $10.24 per share of common stock. Prior to September 10, 2012, distributions were calculated at a rate of $0.001917 per share of common stock, which was equivalent to a 7.0% annualized distribution rate based on a purchase price of $10.00 per share of common stock. There is no guarantee that we will pay distributions at this rate in the future or at all.

Distributions declared during the years ended December 31, 2014 and 2013 are as follows:

	2014
	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter			Total
Total Distributions Declared	$	13,174,851		$	13,454,087		$	13,785,040		$	13,882,686		$	54,296,664
Total Per Share Distribution	$	0.177		$	0.179		$	0.181		$	0.181		$	0.718
Annualized Rate Based on Purchase Price	7.0		%	7.0		%	7.0		%	7.0		%	7.0		%

	2013
	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter			Total
Total Distributions Declared	$	4,460,763		$	5,720,601		$	7,736,858		$	10,727,539		$	28,645,761
Total Per Share Distribution	$	0.177		$	0.179		$	0.181		$	0.181		$	0.718
Annualized Rate Based on Purchase Price	7.0		%	7.0		%	7.0		%	7.0		%	7.0		%

The tax composition of our distributions declared for the years ended December 31, 2014 and 2013 was as follows:

	December 31, 2014		December 31, 2013
Ordinary income	0.9	%	—	%
Return of capital	99.1	%	100	%
Total	100	%	100	%

On October 21, 2014, our board of directors elected to suspend our distribution reinvestment plan, effective November 20, 2014. All distributions paid following November 20, 2014 are paid in cash. For additional information on our distributions, see Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Distributions.”

Unregistered Sales of Equity Securities

On June 11, 2014, we entered into a restricted stock agreement with our advisor whereby we issued to our advisor 488,281.25 restricted shares of our common stock at a fair market value of $10.24 per share in satisfaction of certain deferred fees due to the advisor in the aggregate amount of $5,000,000. The shares of restricted stock issued to our advisor were issued in a transaction exempt from registration pursuant to Section 4(2) of the Securities Act.

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On August 5, 2014, we granted each of our four independent directors 2,500 shares of restricted stock upon re-election to our board of directors pursuant to our independent directors’ compensation plan. The shares of restricted stock issued pursuant to our independent directors’ compensation plan were issued in transactions exempt from registration pursuant to Section 4(2) of the Securities Act.

Use of Proceeds from Sales of Registered Securities

On July 9, 2010 our Registration Statement on Form S-11 (File No. 333-160748), registering a public offering of up to $1,650,000,000 in shares of our common stock, was declared effective under the Securities Act and we commenced our initial public offering on July 19, 2010. We offered up to 150,000,000 shares of our common stock to the public in our primary offering and up to 15,789,474 shares of our common stock pursuant to our distribution reinvestment plan. We initially offered shares of our common stock to the public in our primary offering at a price of $10.00 per share and to our stockholders pursuant to our distribution reinvestment plan at a price of $9.50 per share. As a result of our determination of our estimated value per share as of March 31, 2012, effective September 10, 2012, the offering price of shares of our common stock to the public in our primary offering increased from a price of $10.00 per share to a price of $10.24 per share and the purchase price for shares issued pursuant to our distribution reinvestment plan increased from a price of $9.50 per share to a price of $9.73 per share. Our initial public offering terminated on December 20, 2013. As of December 31, 2014, we had sold 76,095,108 shares of our common stock in our public offering for gross offering proceeds of $769,573,285, including 4,073,751 shares of common stock issued pursuant to our distribution reinvestment plan for gross offering proceeds of $39,580,769.

As of December 31, 2014, we had recognized selling commissions, dealer manager fees and organization and other offering costs in our public offering in the amounts set forth below. The dealer manager for our public offering reallowed all of the selling commissions and a portion of the dealer manager fees to participating broker-dealers.

Type of Expense Amount	Amount			Estimated/ Actual
Selling commissions and dealer manager fees	$	69,841,541		Actual
Other organization and offering costs	23,802,946			Actual
Total expenses	$	93,644,487		Actual
Total public offering proceeds (excluding distribution reinvestment plan proceeds)	$	729,992,516		Actual
Percentage of public offering proceeds used to pay for organization and offering costs	12.8		%	Actual

From the commencement of our initial public offering through December 31, 2014, the net offering proceeds to us, after deducting the total expenses incurred as described above, were $675,928,798, including net offering proceeds from our distribution reinvestment plan of $39,580,769. For the year ended December 31, 2014, the ratio of the cost of raising equity capital to the gross amount of equity capital raised was approximately 12.8%.

As of December 31, 2014, we had invested in 65 multifamily properties for a total purchase price of $1,624,892,557. These property acquisitions were funded from proceeds of our offerings and $1,042,964,196 in secured financings.

Share Repurchase Plan

Our share repurchase may provide an opportunity for our stockholders to have their shares of common stock repurchased by us, subject to certain restrictions and limitations. No shares can be repurchased under our share repurchase plan until after the first anniversary of the date of purchase of such shares; provided, however, that this holding period shall not apply to repurchases requested within two years after the death or disability of a stockholder.

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The purchase price for shares repurchased under our share repurchase plan will be as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of Estimated Value per Share(2)
2 years	95.0% of Estimated Value per Share(2)
3 years	97.5% of Estimated Value per Share(2)
4 years	100.0% of Estimated Value per Share(2)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

________________

(1) As adjusted for any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares of common stock.

(2) For purposes of the share repurchase plan, the “estimated value per share” will equal the most recently determined estimated value per share when the share repurchase plan is in effect. Thereafter, the estimated value per share will be determined by our board of directors annually, based on periodic valuations by independent third-party appraisers selected by our advisor and approved by our board of directors.

(3) The required one year holding period to be eligible to redeem shares under our share repurchase plan does not apply in the event of death or disability of a stockholder.

(4) The purchase price per share for shares redeemed upon the death or disability of a stockholder will be equal to the average issue price per share for all of the stockholder’s shares.

The purchase price per share for shares repurchased pursuant to the share repurchase plan will be further reduced by the aggregate amount of net proceeds per share, if any, distributed to our stockholders prior to the repurchase date as a result of the sale of one or more of our assets that constitutes a return of capital distribution as a result of such sales.

Repurchases of shares of our common stock will be made quarterly upon written request to us at least 15 days prior to the end of the applicable quarter. Repurchase requests will be honored approximately 30 days following the end of the applicable quarter, which we refer to as the “repurchase date.” Stockholders may withdraw their repurchase request at any time up to three business days prior to the repurchase date.

We cannot guarantee that any funds set aside for the share repurchase plan will be sufficient to accommodate all repurchase requests made in any quarter. In the event that we do not have sufficient funds available to repurchase all of the shares of our common stock for which repurchase requests have been submitted in any quarter, priority will be given to redemption requests in the case of the death or disability of a stockholder. If we repurchase less than all of the shares subject to a repurchase request in any quarter, with respect to any shares which have not been repurchased, a stockholder could (1) withdraw the request for repurchase or (2) ask that we honor the request in a future quarter, if any, when such repurchases could be made pursuant to the limitations of the share repurchase plan and when sufficient funds are available. Such pending requests will be honored among all requests for redemptions in any given redemption period as follows: first, pro rata as to redemptions sought upon a stockholder’s death or disability; and, next, pro rata as to other redemption requests.

We are obligated to repurchase shares of our common stock under the share repurchase plan. In no event shall redemptions under the share repurchase plan exceed 5% of the weighted average number of shares of our common stock outstanding during the prior calendar year. There is no fee in connection with a repurchase of shares of our common stock.

The aggregate amount of repurchases under our share repurchase plan is not expected to exceed the aggregate proceeds received from the sale of shares pursuant to our distribution reinvestment plan. However, if this amount is not sufficient to fund repurchase requests, subject to the 5% limitation outlined above, our board of directors may, in its sole discretion, choose to use other sources of funds to repurchase shares of our common stock. Such sources of funds could include cash on hand, cash available from borrowings and cash from liquidations of securities investments as of the end of the applicable month, to the

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extent that such funds are not otherwise dedicated to a particular use, such as working capital, cash distributions to stockholders or purchases of real estate assets.

In addition, our board of directors may, in its sole discretion, amend, suspend, or terminate the share repurchase plan at any time upon 30 days notice to our stockholders if it determines that the funds available to fund the share repurchase plan are needed for other business or operational purposes or that amendment, suspension or termination of the share repurchase plan is in the best interest of our stockholders. Therefore, stockholders may not have the opportunity to make a repurchase request prior to any potential termination of our share repurchase plan.

On October 21, 2014, our board of directors elected to suspend our share repurchase plan, effective November 20, 2014. As a result, we have not processed redemption requests received after such date. Our board of directors may in the future reinstate the share repurchase plan, although there is no assurance as to if or when this will happen.

During the quarter ending December 31, 2014, we fulfilled redemption requests and redeemed shares of our common stock pursuant to our share repurchase plan as follows:

	Total Number of Shares Requested to be Redeemed(1)	Total Number of Shares Redeemed	Average Price Paid per Share	Approximate Dollar Value of Shares Available That May Yet Be Redeemed Under the Program
October 2014	29,152	63,583	9.77	(2)
November 2014	—	48,631	9.66	(2)
December 2014	—	—	—	(2)
	29,152	112,214

________________

(1) We generally redeem shares on the last business day of the month following the end of each fiscal quarter in which requests were received.

(2) The number of shares that may be redeemed pursuant to the share repurchase plan during any calendar year is limited to: (1) 5% of the weighted-average number of shares outstanding during the prior calendar year and (2) those that can be funded from the net proceeds we received from the sale of shares under the distribution reinvestment plan during the prior calendar year plus such additional funds as may be reserved for that purpose by our board of directors. On October 21, 2014, our board of directors elected to suspend our share repurchase plan, effective November 20, 2014. As of December 31, 2014, all redemption requests were redeemed.

ITEM 6. SELECTED FINANCIAL DATA

The following selected financial data as of December 31, 2014, 2013, 2012, 2011 and 2010 and for the years then ended should be read in conjunction with the accompanying consolidated financial statements and related notes thereto and Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Our results of operations for the periods presented below are not indicative of those expected in future periods. During the period from May 4, 2009 (inception) to August 10, 2010, we were formed and commenced our private offering and initial public offering but had not yet commenced real estate operations, as we had not yet acquired any real estate investments. As a result, we had no material results of operations for that period.

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	As of December 31,
	2014			2013			2012			2011			2010
Balance sheet data
Total real estate, net	$	1,538,610,961		$	1,470,963,159		$	559,972,087		$	66,751,176		$	17,011,752
Total assets	1,609,067,128			1,561,889,854			582,586,556			81,852,261			20,171,682
Notes payable	1,084,757,025			987,329,800			413,802,388			47,973,049			11,650,000
Total liabilities	1,132,003,898			1,031,826,319			427,455,885			51,243,185			12,926,977
Redeemable common stock	—			12,945,007			3,049,521			385,458			57,827
Total stockholders’ equity	477,063,230			517,118,528			152,081,150			30,223,618			7,186,878
	For the Years Ended December 31,
	2014			2013			2012			2011			2010
Operating data
Total revenues	$	195,929,856		$	109,101,517		$	30,586,932		5,710,173			$	828,230
Net loss	(25,742,292		)	(55,879,857		)	(22,559,927		)	(4,049,010		)	(2,163,581		)
Net loss attributable to common stockholders	(25,742,292		)	(55,879,857		)	(22,559,927		)	(4,049,010		)	(2,162,581		)
Loss per common share - basic and diluted	(0.34		)	(1.39		)	(1.84		)	(1.72		)	(4.27		)
Other data
Cash flows provided by (used in) operating activities	48,556,847			(2,249,133		)	(4,563,196		)	(201,273		)	(455,876		)
Cash flows used in investing activities	(126,817,478		)	(849,128,988		)	(382,505,492		)	(53,833,531		)	(10,902,324		)
Cash flows provided by financing activities	88,237,738			861,401,662			384,396,671			63,377,288			14,014,390
Distributions declared	54,296,664			28,645,761			8,636,158			1,640,845			230,402
Distributions declared per common share(1)	0.718			0.718			0.706			0.700			0.272
Weighted-average number of common shares outstanding, basic and diluted	75,450,215			40,169,940			12,238,094			2,358,867			506,003
FFO(2)	33,994,751			(7,404,678		)	(7,602,070		)	(1,471,548		)	(1,623,009		)
MFFO(2)	45,002,936			19,253,075			5,828,557			469,670			(940,466		)

________________

(1) Distributions declared per common share for the years ended December 31, 2014, 2013, 2012 and 2011 assumes each share was issued and outstanding each day of each year. Distributions declared per common share for the year ended December 31, 2010 assumes each share was issued and outstanding each day from August 12, 2010 (the first day distributions began to accrue) through December 31, 2010. Distributions currently declared are calculated at a rate of $0.001964 per share of common stock per day, which if paid each day over a 365-day period is equivalent to a 7.0% annualized distribution rate based on a purchase price of $10.24 per share of common stock. Prior to September 10, 2012, distributions were calculated at a rate of $0.001917 per share of common stock per day, which was equivalent to a 7.0% annualized distribution rate based on a purchase price of $10.00 per share of common stock. We made our first monthly distribution payment in September 2010.

(2) GAAP basis accounting for real estate assets utilizes historical cost accounting and assumes real estate values diminish over time. In an effort to overcome the difference between real estate values and historical cost accounting for real estate assets, the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT, established the measurement tool of funds from operations, or FFO. Since its introduction, FFO has become a widely used non-GAAP financial measure among REITs. Additionally, we use modified funds from operations, or MFFO, as defined by the Investment Program Association as a supplemental measure to evaluate our operating performance. MFFO is based on FFO but includes certain adjustments we believe are necessary due to changes in accounting and reporting under GAAP since the establishment of FFO. Neither FFO or MFFO should be considered as alternatives to net loss or other measurements under GAAP as indicators of our operating performance, nor should they be considered as alternatives to cash flow from operating activities or other measurements under GAAP as indicators of liquidity. For

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additional information on how we calculate FFO and MFFO and a reconciliation of FFO and MFFO to net loss, see Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Funds From Operations and Modified Funds From Operations.”

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the “Selected Financial Data” above and our accompanying consolidated financial statements and the notes thereto included in this annual report. Also see “Cautionary Note Regarding Forward-Looking Statements” preceding Part I.

Overview

We were formed on May 4, 2009, as a Maryland corporation that has elected to qualify as a real estate investment trust, or REIT. We invest in and manage a diverse portfolio of real estate investments, primarily in the multifamily sector, located throughout the United States. In addition to our focus on multifamily properties, we may also selectively invest in commercial properties, as well as acquire or originate mortgage, mezzanine, bridge and other real estate loans and equity securities of other real estate companies.

On July 19, 2010, we commenced our initial public offering of up to a maximum of 150,000,000 shares of common stock at an initial price of $10.00 per share (subject to certain discounts) and up to 15,789,474 shares of common stock pursuant to our distribution reinvestment plan at an initial price of $9.50 per share. On July 12, 2012, our board of directors determined an estimated value per share of our common stock of $10.24 as of March 31, 2012. As a result of the determination of the estimated value per share of our common stock as of March 31, 2012, effective September 10, 2012, the offering price of our common stock in our ongoing public offering increased from the previous price of $10.00 per share to $10.24 per share. Additionally, effective September 10, 2012, the price of shares of our common stock issued pursuant to our distribution reinvestment plan increased from a price of $9.50 per share to a price of $9.73 per share, or 95% of the new offering price of $10.24 per share.

On December 20, 2013, we terminated our ongoing public offering. Upon termination of our public offering, we had sold 73,608,337 shares of common stock for gross proceeds of $745,389,748, including 1,588,289 shares of common stock issued pursuant to our distribution reinvestment plan for gross offering proceeds of $15,397,232. Following the termination of our initial public offering, we continued to offer shares of our common stock pursuant to our distribution reinvestment plan until our board of directors determined to suspend our distribution reinvestment plan effective November 20, 2014.

Prior to the commencement of our public offering, we sold shares of our common stock in a private offering exempt from the registration requirements of the Securities Act. Upon termination of the private offering, we had sold 637,279 shares of common stock at $9.40 per share (subject to certain discounts) for gross offering proceeds of $5,844,325.

Steadfast Income Advisor, LLC is our advisor. Subject to certain restrictions and limitations, our advisor manages our day-to-day operations and our portfolio of properties and real estate-related assets. Our advisor sources and presents investment opportunities to our board of directors. Our advisor also provides investment management, marketing, investor relations and other administrative services on our behalf.

Substantially all of our business is conducted through Steadfast Income REIT Operating Partnership, L.P., our operating partnership. We are the sole general partner of our operating partnership. The initial limited partner of our operating partnership is our advisor. The limited partnership agreement of our operating partnership provides that our operating partnership will be operated in a manner that will enable us to: (1) satisfy the requirements for being classified as a REIT for tax purposes, (2) avoid any federal income or excise tax liability and (3) ensure that our operating partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Internal Revenue Code, which classification could result in our operating partnership being taxed as a corporation, rather than as a partnership. In addition to the administrative and operating costs and expenses incurred by our operating partnership in acquiring and operating real properties, our operating partnership will pay all of our administrative costs and expenses, and such expenses will be treated as expenses of our operating partnership.

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We have made an election to be taxed as a REIT under the Internal Revenue Code beginning with the taxable year ended December 31, 2010. As a REIT, we generally will not be subject to federal income tax to the extent that we distribute qualifying dividends to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year in which qualification is denied. Failing to qualify as a REIT could materially and adversely affect our net income.

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Our Real Estate Portfolio

As of December 31, 2014, we owned the 65 multifamily properties listed below:

							Mortgage Debt Outstanding at December 31, 2014		Average Occupancy(1) as of				Average Monthly Rent(2) as of
	Property Name	Location	Purchase Date	Number of Units	Contract Purchase Price				Dec 31, 2014		Dec 31, 2013		Dec 31, 2014		Dec 31, 2013
1	Park Place Condominiums	Des Moines, IA	12/22/2010	151	$	8,323,400	$	4,890,069	86.1	%	92.7	%	$	813	$	867
2	Clarion Park Apartments	Olathe, KS	6/28/2011	220	11,215,000		8,479,259		97.7	%	97.3	%	753		701
3	Cooper Creek Village	Louisville, KY	8/24/2011	123	10,420,000		6,500,887		94.3	%	91.9	%	913		753
4	Truman Farm Villas	Grandview, MO	12/22/2011	200	9,100,000		5,709,615		98.0	%	94.5	%	679		676
5	EBT Lofts	Kansas City, MO	12/30/2011	102	8,575,000		5,397,291		95.1	%	98.0	%	924		882
6	Windsor on the River Apartments	Cedar Rapids, IA	1/26/2012	424	33,000,000		23,500,000		94.8	%	92.0	%	686		680
7	Renaissance St. Andrews Apartments	Louisville, KY	2/17/2012	216	12,500,000		8,937,635		97.7	%	93.5	%	658		642
8	Spring Creek of Edmond	Edmond, OK	3/9/2012	252	19,350,000		13,577,869		96.0	%	96.4	%	847		865
9	Montclair Parc Apartments	Oklahoma City, OK	4/26/2012	360	35,750,000		23,827,037		96.7	%	88.6	%	866		918
10	Sonoma Grande Apartments	Tulsa, OK	5/24/2012	336	32,200,000		22,324,719		95.2	%	91.4	%	953		932
11	Estancia Apartments	Tulsa, OK	6/29/2012	294	27,900,000		21,485,523		95.9	%	90.5	%	961		898
12	Montelena Apartments	Round Rock, TX	7/13/2012	232	18,350,000		12,290,751		94.8	%	89.7	%	1,003		860
13	Valley Farms Apartments	Louisville, KY	8/30/2012	160	15,100,000		10,068,528		97.5	%	93.8	%	845		790
14	Hilliard Park Apartments	Columbus, OH	9/11/2012	201	19,800,000		13,563,481		97.0	%	94.0	%	999		947
15	Sycamore Terrace Apartments	Terre Haute, IN	9/20/2012 & 3/5/2014	250	23,174,157		—		94.8	%	96.6	%	1,151		1,033
16	Hilliard Summit Apartments	Columbus, OH	9/28/2012	208	24,100,000		16,436,620		90.9	%	92.3	%	1,080		1,098
17	Springmarc Apartments	San Marcos, TX	10/19/2012	240	21,850,000		15,166,129		92.5	%	96.7	%	878		883
18	Renaissance at St. Andrews Condominiums	Louisville, KY	10/31/2012	29	1,375,000		—		96.6	%	96.6	%	650		674
19	Ashley Oaks Apartments	San Antonio, TX	11/29/2012	462	30,790,000		21,296,125		93.3	%	80.7	%	756		716
20	Arrowhead Apartments	Palatine, IL	11/30/2012	200	16,750,000		12,321,880		97.5	%	91.5	%	1,027		941
21	The Moorings Apartments	Roselle, IL	11/30/2012	216	20,250,000		14,896,178		95.4	%	94.4	%	1,022		995
22	Forty 57 Apartments	Lexington, KY	12/20/2012	436	52,500,000		38,500,000		95.0	%	95.2	%	836		840

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							Mortgage Debt Outstanding at December 31, 2014		Average Occupancy(1) as of				Average Monthly Rent(2) as of
	Property Name	Location	Purchase Date	Number of Units	Contract Purchase Price				Dec 31, 2014		Dec 31, 2013		Dec 31, 2014		Dec 31, 2013
23	Keystone Farms Apartments	Nashville, TN	12/28/2012	90	$	8,400,000	$	6,100,287	98.9	%	98.9	%	$	1,044	$	1,001
24	Riverford Crossing Apartments	Frankfort, KY	12/28/2012	300	30,000,000		21,900,000		96.7	%	90.0	%	803		760
25	South Pointe at Valley Farms	Louisville, KY	12/28/2012	32	5,275,000		1,155,185		93.8	%	100.0	%	992		1,029
26	Montecito Apartments	Austin, TX	12/31/2012	268	19,000,000		14,003,890		95.9	%	98.1	%	855		831
27	Hilliard Grand Apartments	Dublin, OH	12/31/2012	314	40,500,000		28,832,151		96.8	%	88.5	%	1,217		1,182
28	The Hills at Fair Oaks	Fair Oaks Ranch, TX	1/31/2013	288	34,560,000		24,767,000		95.8	%	90.6	%	975		921
29	Library Lofts	Kansas City, MO	2/28/2013	118	12,750,000		8,941,943		98.3	%	97.5	%	955		885
30	Trails at Buda Ranch	Buda, TX	3/28/2013	264	23,000,000		16,821,368		95.1	%	89.8	%	999		862
31	Deep Deuce at Bricktown	Oklahoma City, OK	3/28/2013	294	38,220,000		26,639,205		95.2	%	84.7	%	1,296		1,138
32	Deer Valley Apartments	Lake Bluff, IL	4/30/2013	224	28,600,000		20,645,873		96.4	%	91.1	%	1,270		1,160
33	Grayson Ridge	North Richland Hills, TX	5/31/2013	240	14,300,000		10,631,586		92.9	%	95.8	%	750		671
34	Rosemont at Olmos Park	San Antonio, TX	5/31/2013	144	22,050,000		14,667,462		93.1	%	87.5	%	1,239		1,196
35	Retreat at Quail North	Oklahoma City, OK	6/12/2013	240	25,250,000		17,029,692		97.5	%	90.0	%	956		954
36	The Lodge at Trails Edge	Indianapolis, IN	6/18/2013	268	18,400,000		12,657,096		95.5	%	97.8	%	708		691
37	Arbors of Carrollton	Carrollton, TX	7/3/2013	131	8,800,000		6,261,078		96.9	%	94.7	%	824		768
38	Waterford on the Meadow	Plano, TX	7/3/2013	350	23,100,000		16,603,668		93.1	%	91.7	%	843		802
39	The Belmont	Grand Prairie, TX	7/26/2013	260	12,100,000		9,295,899		96.9	%	93.1	%	736		684
40	Meritage at Steiner Ranch	Austin, TX	8/6/2013	502	80,000,000		55,198,913		92.6	%	84.5	%	1,342		1,361
41	Tapestry Park Apartments	Birmingham, AL	8/13/2013 &12/1/2014	354	50,285,000		34,725,000		63.6	%	97.8	%	1,196		1,183
42	Dawntree Apartments	Carrollton, TX	8/15/2013	400	24,000,000		15,833,312		94.5	%	96.3	%	773		711
43	Stuart Hall Lofts	Kansas City, MO	8/27/2013	115	16,850,000		12,350,045		93.0	%	93.9	%	1,213		1,134
44	BriceGrove Park Apartments	Canal Winchester, OH	8/29/2013	240	20,100,000		14,932,281		92.9	%	90.0	%	813		864
45	Retreat at Hamburg Place	Lexington, KY	9/5/2013	150	16,300,000		—		95.3	%	94.0	%	932		913
46	Cantare at Indian Lake Village	Hendersonville, TN	9/24/2013	206	29,000,000		18,850,000		95.1	%	96.6	%	1,070		1,037
47	Landing at Mansfield	Mansfield, TX	9/27/2013	336	30,900,000		22,671,543		93.2	%	93.8	%	918		877

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							Mortgage Debt Outstanding at December 31, 2014		Average Occupancy(1) as of				Average Monthly Rent(2) as of
	Property Name	Location	Purchase Date	Number of Units	Contract Purchase Price				Dec 31, 2014		Dec 31, 2013		Dec 31, 2014		Dec 31, 2013
48	The Heights Apartments	Houston, TX	9/30/2013	504	$	37,000,000	$	28,912,294	93.1	%	94.4	%	$	929	$	862
49	Villas at Huffmeister	Houston, TX	10/10/2013	294	37,600,000		25,917,180		96.3	%	95.2	%	1,137		1,128
50	Villas at Kingwood	Kingwood, TX	10/10/2013	330	40,150,000		28,055,400		95.8	%	90.9	%	1,168		1,050
51	Waterford Place at Riata Ranch	Cypress, TX	10/10/2013	228	23,400,000		16,310,966		96.9	%	94.3	%	1,075		1,024
52	Carrington Place	Houston, TX	11/7/2013	324	32,900,000		22,376,000		94.1	%	91.7	%	998		981
53	Carrington at Champion Forest	Houston, TX	11/7/2013	284	33,000,000		22,959,000		96.8	%	93.0	%	1,051		1,024
54	Carrington Park at Huffmeister	Cypress, TX	11/7/2013	232	25,150,000		17,717,000		93.1	%	91.8	%	1,045		1,016
55	Willow Crossing	Elk Grove, IL	11/20/2013	579	58,000,000		43,500,000		92.4	%	95.5	%	974		950
56	Echo at Katy Ranch	Katy, TX	12/19/2013	260	35,100,000		—		93.1	%	65.8	%	1,328		1,349
57	Heritage Grand at Sienna Plantation	Missouri City, TX	12/20/2013	240	27,000,000		16,697,112		94.6	%	93.8	%	1,186		1,175
58	Audubon Park	Nashville, TN	12/27/2013	256	16,750,000		11,760,000		92.6	%	92.2	%	823		823
59	Mallard Crossing	Cincinnati, OH	12/27/2013	350	39,800,000		27,860,000		92.0	%	87.4	%	989		1,016
60	Renaissance at Carol Stream	Carol Stream, IL	12/31/2013	293	29,150,000		20,440,000		93.5	%	95.9	%	1,000		966
61	Reserve at Creekside	Chattanooga, TN	3/28/2014	192	18,875,000		—		94.3	%	—	%	909		—
62	Mapleshade Park	Dallas, TX	3/31/2014	148	23,325,000		15,161,000		89.9	%	—	%	1,462		—
63	Richland Falls	Murfreesboro, TN	5/16/2014	190	21,000,000		13,800,000		96.3	%	—	%	860		—
64	Oak Crossing	Fort Wayne, IN	6/3/2014	222	24,230,000		15,762,000		95.9	%	—	%	956		—
65	Park Shore	St. Charles, IL	9/12/2014	160	18,350,000		12,845,000		95.0	%	—	%	1,113		—
				16,526	$	1,624,892,557	$	1,070,757,025	94.1	%	92.4	%	$	966	$	897

________________

(1) At December 31, 2014 and 2013, our portfolio was approximately 96.6% and 94.7% leased.

(2) Average monthly rent is based upon the effective rental income after considering the effect of vacancies, concessions and write-offs.

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2014 Real Estate Acquisitions

Sycamore Terrace Phase II

On March 5, 2014, we acquired a fee simple interest in Sycamore Terrace Phase II located in Terre Haute, Indiana, for an aggregate purchase price of approximately $6,674,157, exclusive of closing costs. We financed the payment of the purchase price for Sycamore Terrace Phase II with remaining proceeds from our initial public offering. Sycamore Terrace Phase II contains 72 apartment homes consisting of 24one-bedroom apartments, 36two-bedroom apartments and 12three-bedroom apartments. The apartments range in size from 905 to 1,535 square feet and average 1,128 square feet.

Reserve at Creekside

On March 28, 2014, we acquired a fee simple interest in Reserve at Creekside located in Chattanooga, Tennessee, for an aggregate purchase price of approximately $18,875,000, exclusive of closing costs. We financed the payment of the purchase price for Reserve at Creekside with the remaining proceeds from our initial public offering. Reserve at Creekside consists of eightthree-story residential buildings and contains 192 apartment homes consisting of 48one-bedroom apartments, 96two-bedroom apartments and 48three-bedroom apartments. The apartments range in size from 867 to 1,342 square feet and average 1,102 square feet.

Mapleshade Park

On March 31, 2014, we acquired a fee simple interest in Mapleshade Park located in Dallas, Texas, for an aggregate purchase price of approximately $23,325,000, exclusive of closing costs. We financed the payment of the purchase price for Mapleshade Park with (1) remaining proceeds from our initial public offering and (2) the proceeds of a secured loan in the aggregate principal amount of $15,161,000 from a financial institution. Mapleshade Park consists of 25two-story residential buildings and contains 148two-bedroom apartment homes. The apartments range in size from 1,101 to 1,305 square feet and average 1,236 square feet.

Richland Falls

On May 16, 2014, we acquired a fee simple interest in Richland Falls located in Murfreesboro, Tennessee, for an aggregate purchase price of approximately $21,000,000, exclusive of closing costs. We financed the payment of the purchase price for Richland Falls with (1) remaining proceeds from our initial public offering and (2) the proceeds of a secured loan in the aggregate principal amount of $13,800,000 from a financial institution. Richland Falls consists of ninetwo- and three-story buildings and contains 190 units consisting of 50one-bedroom apartments, 128two-bedroom apartments and 12three-bedroom apartments. The apartments range in size from 727 to 1,301 square feet and average 1,026 square feet.

Oak Crossing

On June 3, 2014, we acquired a fee simple interest in Oak Crossing located in Fort Wayne, Indiana, for an aggregate purchase price of approximately $24,230,000, exclusive of closing costs. We financed the payment of the purchase price for Oak Crossing with (1) remaining proceeds from our initial public offering and (2) the proceeds of a secured loan in the aggregate principal amount of $15,762,000 from a financial institution. Oak Crossing consists of 12three-story buildings and contains 222 units consisting of 84one-bedroom apartments, 118two-bedroom apartments and 20three-bedroom apartments. The apartments range in size from 702 to 1,435 square feet and average 1,010 square feet.

Park Shore Apartments

On September 12, 2014, we acquired a fee simple interest in Park Shore Apartments located in St. Charles, Illinois, for an aggregate purchase price of approximately $18,350,000, exclusive of closing costs. We financed the payment of the purchase price for Park Shore Apartments with (1) net sales proceeds from the disposition of Lincoln Tower Apartments, Arbor Pointe Apartments and Prairie Walk Apartments and (2) the proceeds of a secured loan in the aggregate principal amount of $12,845,000 from a financial institution. Park Shore Apartments consists of 20two-story buildings and contains 160 units

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consisting of onestudio apartment, 67one-bedroom apartments, 68two-bedroom apartments and 24three-bedroom apartments. The apartments range in size from 520 to 1,150 square feet and average 767 square feet.

Tapestry Park Apartments Phase II

On December 1, 2014, we acquired a fee simple interest in Tapestry Park Apartments Phase II located in Birmingham, Alabama, for an aggregate purchase price of approximately $17,885,000, exclusive of closing costs. We financed the payment of the purchase price for Tapestry Park Apartments Phase II with (1) net sales proceeds from the disposition of Lincoln Tower Apartments, Arbor Pointe Apartments and Prairie Walk Apartments and (2) the proceeds of a secured loan from a financial institution. Our strategy is to operate and manage Tapestry Park Apartments and Tapestry Park Apartments Phase II as a single property. In conjunction with the Tapestry Park Apartments Phase II acquisition, our existing mortgage loan secured by Tapestry Park Apartments in the amount of $23,100,000 was repaid in full and replaced with a new mortgage loan in the aggregate principal amount of $34,725,000. Tapestry Park Apartments Phase II consists of three residential buildings and contains 131 units consisting of 78one-bedroom apartments, 42two-bedroom apartments and 11three-bedroom apartments. The apartments range in size from 664 to 1,322 square feet and average 992 square feet.

2014 Real Estate Dispositions

Lincoln Tower Apartments

On August 11, 2010, we acquired the Lincoln Tower Apartments located in Springfield, Illinois for a total purchase price of $9,500,000, exclusive of closing costs. On June 27, 2014, we sold the Lincoln Tower Apartments for $15,887,500, resulting in a gain of $7,072,294 from the original purchase price.

Arbor Pointe Apartments

On May 5, 2011, we acquired the Arbor Pointe Apartments located in Louisville, Kentucky for a total purchase price of $6,500,000, exclusive of closing costs. On July 1, 2014, we sold the Arbor Pointe Apartments for $8,325,000, resulting in a gain of $2,034,244 from the original purchase price.

Prairie Walk Apartments

On December 22, 2011, we acquired the Prairie Walk Apartments located in Kansas City, Missouri for a total purchase price of $6,100,000, exclusive of closing costs. On August 6, 2014, we sold the Prairie Walk Apartments for $6,700,000, resulting in a gain of $837,596 from the original purchase price.

Review of our Policies

Our board of directors, including our independent directors, has reviewed our policies described in this annual report, including policies regarding our investments, leverage and conflicts of interest, and determined that the policies are in the best interests of our stockholders.

Liquidity and Capital Resources

At the conclusion of our initial public offering, our overall borrowings were approximately 65% of the cost of our investments. Going forward, we expect that our borrowings will be approximately 65% of the value of our properties, as determined by an independent third party appraiser or qualified independent valuation expert. Under our charter, we are prohibited from borrowing in excess of 300% of the value of our net assets, which generally approximates to 75% of the aggregate cost of our assets, though we may exceed this limit under certain circumstances. As of December 31, 2014, our borrowings were not in excess of 300% of the value of our net assets.

We expect to use our capital resources to make certain payments to our advisor in connection with the acquisition of investments, the management of our assets and costs incurred by our advisor in providing services to us.

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Our principal demand for funds will be to pay operating expenses and interest on our outstanding indebtedness, fund value enhancement projects and and to make distributions to our stockholders. We intend to generally fund our cash needs for items, other than asset acquisitions, from operations. Otherwise, we expect that our principal sources of working capital will include:

• current unrestricted cash balances, which was $29,529,312 as of December 31, 2014;

• various forms of secured and unsecured financing;

• equity capital from joint venture partners; and

• proceeds from our operating partnership’s private placements, if any.

Over the short term, we believe that our sources of capital, specifically our cash balances, cash flow from operations, our ability to raise equity capital from joint venture partners or otherwise, our ability to obtain various forms of secured and unsecured financing and proceeds from our operating partnership’s private placements of securities, if any, will be adequate to meet our liquidity requirements and capital commitments.

Over the longer term, in addition to the same sources of capital we will rely on to meet our short term liquidity requirements, we may also utilize additional secured and unsecured financings and proceeds from the sale of our properties. We may also conduct additional public or private offerings of interests in us or our operating partnership. There can be no assurance that we will be able to obtain such financing or capital on favorable terms, if at all. We expect these resources will be adequate to fund our operating activities, debt service and distributions, which may grow over time, and will be sufficient to fund our ongoing acquisition activities as well as providing capital for investment in future development and other joint ventures along with potential forward purchase commitments.

On October 22, 2012, we entered into a revolving credit facility with PNC Bank, National Association to borrow up to $5,000,000.  On April 25, 2013, we amended the credit facility to increase the borrowing capacity to $20,000,000. On July 18, 2014, we further amended the revolving credit facility, to, among other things, increase the borrowing capacity from $20,000,000 to $35,000,000. The amended and restated credit facility consists of a Tranche A and a Tranche B, and provides certain security for borrowings under the credit facility. The maximum amount that may be borrowed under Tranche A and Tranche B is $20,000,000 and $15,000,000, respectively. The amended and restated credit facility has a maturity date of July 17, 2016, subject to extension. As of December 31, 2014, $14,000,000 was outstanding on our revolving line of credit. We continue to evaluate possible sources of capital, including, without limitation, entering into additional credit facilities. There can be no assurance that we will be able to obtain any such financings on favorable terms, if at all.

Our advisor may, but is not required to, establish working capital reserves from cash flow generated by our investments or out of proceeds from the sale of our investments. We do not anticipate establishing a general working capital reserve; however, we may establish capital reserves with respect to particular investments. We also may, but are not required to, establish reserves out of cash flow generated by investments or out of net sale proceeds in non-liquidating sale transactions. Working capital reserves are typically utilized to fund tenant improvements, leasing commissions and major capital expenditures. Our lenders also may require working capital reserves.

To the extent that the working capital reserve is insufficient to satisfy our cash requirements, additional funds may be provided from cash generated from operations or through short-term borrowing. In addition, subject to certain limitations described in our charter, we may incur indebtedness in connection with the acquisition of any real estate asset, refinance the debt thereon, arrange for the leveraging of any previously unfinanced property or reinvest the proceeds of financing or refinancing in additional properties.

Cash Flows Provided by (Used in) Operating Activities

We commenced real estate operations with the acquisition of our first multifamily property on August 11, 2010. As of December 31, 2014, we owned 65 multifamily properties. During the year ended December 31, 2014, net cash provided by operating activities was $48,556,847 compared to net cash used in operating activities of $2,249,133 for the year ended December 31, 2013. The increase in net cash provided by operating activities is primarily due to a reduction of net loss and an increase in depreciation and amortization expense associated with the seven additional multifamily properties acquired in 2014 as well as the 33 multifamily properties acquired in 2013 that experienced a full year of operations in 2014. We expect to continue to generate cash flows from operations as we stabilize the operations of our property portfolio.

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Cash Flows Used in Investing Activities

During the year ended December 31, 2014, net cash used in investing activities was $126,817,478 compared to net cash used in investing activities of $849,128,988 during the year ended December 31, 2013. The decrease in net cash used in investing activities was primarily due to the acquisition of seven multifamily properties during the year ended December 31, 2014, compared to 33 property acquisitions during the year ended December 31, 2013. Net cash used in investing activities during the year ended December 31, 2014 consisted of the following:

• $126,718,757 of cash used related to the acquisition of seven multifamily properties;

• $26,806,870 of cash used for improvements to real estate investments;

• $3,120,400 of cash used for deposits for potential real estate investments;

• $931,301 of cash provided by restricted cash accounts related to replacement reserves and proceeds from the sale of real estate restricted for use toward future real estate acquisition;

• $863,934 of cash used to purchase interest rate cap agreements; and

• $29,761,182 of cash provided by the sale of real estate investments, net of disposition fees of $463,688 and closing costs of $678,518.    

Cash Flows from Financing Activities

For the year ended December 31, 2014, our cash flows from financing activities consisted primarily of proceeds from our notes payable, net of distributions paid to our stockholders. During the year ended December 31, 2014, net cash provided by financing activities was $88,237,738 compared to net cash provided by financing activities of $861,401,662 during the year ended December 31, 2013. Net cash provided by financing activities during the year ended December 31, 2014 consisted of the following:

• $23,455,983 of cash provided by offering proceeds related to our initial public offering, net of the reimbursement of other offering costs to affiliates in the amount of $3,105,246;

• $82,997,692 of proceeds from the issuance of mortgage notes payable, net of deferred financing costs in the amount of $1,664,326 and principal payments of $71,576,167;

• $14,000,000 from net borrowings on our credit facility;

• $2,723,948 of cash paid for the redemption of common stock; and

• $29,491,989 of net cash distributions, after giving effect to distributions reinvested by stockholders of $24,183,672.

Contractual Commitments and Contingencies

We use, and intend to use in the future, secured and unsecured debt, as a means of providing additional funds for the acquisition of our properties and our real estate-related assets. We believe that the careful use of borrowings will help us achieve our diversification goals and potentially enhance the returns on our investments. At the conclusion of our public offering, our borrowings were approximately 65% of the cost of our real properties (before deducting depreciation and amortization) plus the value of our other investments. Going forward, we expect that our borrowings will be approximately 65% of the value of our properties, as determined by an independent third party appraiser or qualified independent valuation expert. Under our charter, we are prohibited from borrowing in excess of 300% of our net assets, which generally approximates to 75% of the aggregate cost of our assets. We may borrow in excess of this amount if such excess is approved by a majority of the independent directors and disclosed to stockholders in our next quarterly report, along with a justification for such excess. In such event, we will monitor our debt levels and take action to reduce any such excess as practicable. Our aggregate borrowings are reviewed by our board of directors at least quarterly. As of December 31, 2014, our borrowings were not in excess of 300% of the value of our net assets.

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In addition to using our capital resources for investing purposes and meeting our debt obligations, we expect to use our capital resources to make certain payments to our advisor. We expect to make payments to our advisor or its affiliates in connection with the selection and origination or purchase of real estate and real estate-related investments, the management of our assets, the management of the development or improvement of our assets and costs incurred by our advisor in providing services to us.

As of December 31, 2014, we had notes payable totaling an aggregate principal amount of $1,084,757,025. For more information on our outstanding indebtedness, see Note 5 (Debt) to the consolidated financial statements included in this annual report.

The following is a summary of our contractual obligations as of December 31, 2014:

			Payments due by period
Contractual Obligations	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Interest payments on outstanding debt obligations(1)	$	286,101,252	$	37,472,407	$	75,435,337	$	65,413,419	$	107,780,089
Principal payments on outstanding debt obligations(2)	1,080,070,227		14,106,234		81,652,325		210,788,671		773,522,997
Total	$	1,366,171,479	$	51,578,641	$	157,087,662	$	276,202,090	$	881,303,086

________________

(1) Projected interest payments on outstanding debt obligations are based on the outstanding principal amounts and interest rates in effect at December 31, 2014. We incurred interest expense of $40,412,744 during the year ended December 31, 2014, including amortization of deferred financing costs totaling $1,489,834, net unrealized losses from the change in fair value of interest rate cap agreements of $4,353,301 and capitalized interest of $41,898.

(2) Projected principal payments on outstanding debt obligations are based on the terms of the notes payable agreements. Amounts exclude the amortization of the debt premiums associated with certain notes payable.

Results of Operations

Overview

The discussion that follows is based on our consolidated results of operations for the years ended December 31, 2014, 2013 and 2012. The ability to compare one period to another is significantly affected by acquisitions completed and dispositions made during those periods. As of December 31, 2014, we owned 65 multifamily properties compared to owning 63 multifamily properties at December 31, 2013 and only 30 multifamily properties at December 31, 2012. The increase in our property portfolio is the primary cause of the increases in our operating income and expenses, as further discussed below.

Our results of operations for the years ended December 31, 2014, 2013 and 2012 are not indicative of those expected in future periods. For the years ended December 31, 2013 and 2012, we had not yet invested all of the proceeds from our public offering and therefore increased our borrowings and made acquisitions during these periods, which had a significant impact on our future results of operations. For the year ended December 31, 2014, we continue the process of value-enhancement projects, which may have a significant impact on our future results of operations. In general, we expect that our income and expenses related to our portfolio will increase in future periods as a result of anticipated value-enhancement projects.

To provide additional insight into our operating results, we are also providing a detailed analysis of same-store versus non-same-store net operating income, or NOI. For more information on NOI and a reconciliation of NOI (a non-GAAP measure) to net loss, see “—Net Operating Income.”

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Consolidated Results of Operations for the Year Ended December 31, 2014 Compared to the Year Ended December 31, 2013

The following table summarizes the consolidated results of operations for the years ended December 31, 2014 and December 31, 2013:

	For the Years Ended December 31,
	2014			2013			Change $			Change %
Total revenues	$	195,929,856		$	109,101,517		$	86,828,339		79.6	%
Operating, maintenance and management	(52,427,001		)	(28,708,239		)	(23,718,762		)	82.6	%
Real estate taxes and insurance	(34,750,097		)	(17,499,798		)	(17,250,299		)	98.6	%
Fees to affiliates	(23,923,921		)	(30,713,737		)	6,789,816			(22.1	)%
Depreciation and amortization	(69,681,177		)	(48,454,178		)	(21,226,999		)	43.8	%
Interest expense	(40,370,846		)	(24,308,402		)	(16,062,444		)	66.1	%
Loss on debt extinguishment	(1,939,817		)	—			(1,939,817		)	100.0	%
General and administrative expenses	(6,896,519		)	(7,106,568		)	210,049			(3.0	)%
Acquisition costs	(1,626,904		)	(8,169,451		)	6,542,547			(80.1	)%
Loss from continuing operations	$	(35,686,426	)	$	(55,858,856	)	$	20,172,430		(36.1	)%
NOI(1)	$	101,332,546		$	58,737,243		$	42,595,303		72.5	%
FFO(2)	$	33,994,751		$	(7,404,678	)	$	41,399,429		559.1	%
MFFO(2)	$	45,002,936		$	19,253,075		$	25,749,861		133.7	%

________________

(1) NOI is a non-GAAP financial measure used by investors and our management to evaluate and compare the performance of our properties and to determine trends in earnings. However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, interest income and other expense, acquisition costs, certain fees to affiliates, depreciation and amortization expense and gains or losses from the sale of our properties and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs, all of which are significant economic costs. For additional information on how we calculate NOI and a reconciliation of NOI to net loss, see “—Net Operating Income.”

(2) GAAP basis accounting for real estate assets utilizes historical cost accounting and assumes real estate values diminish over time. In an effort to overcome the difference between real estate values and historical cost accounting for real estate assets, the Board of Governors of NAREIT established the measurement tool of FFO. Since its introduction, FFO has become a widely used non-GAAP financial measure among REITs. Additionally, we use MFFO, as defined by the Investment Program Association as a supplemental measure to evaluate our operating performance. MFFO is based on FFO but includes certain adjustments we believe are necessary due to changes in accounting and reporting under GAAP since the establishment of FFO. Neither FFO nor MFFO should be considered as alternatives to net loss or other measurements under GAAP as indicators of our operating performance, nor should they be considered as alternatives to cash flow from operating activities or other measurements under GAAP as indicators of liquidity. For additional information on how we calculate FFO and MFFO and a reconciliation of FFO and MFFO to net loss, see “—Funds From Operations and Modified Funds From Operations.”

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Loss from continuing operations

For the year ended December 31, 2014, we had a loss from continuing operations of $35,686,426 compared to a loss from continuing operations of $55,858,856 for the year ended December 31, 2013. The decrease in loss from continuing operations of $20,172,430 over the prior year was primarily due to the increase in total revenues of $86,828,339, the decrease in fees to affiliates of $6,789,816, the decrease in acquisition costs of $6,542,547 and the decrease in general and administrative expenses of $210,049, partially offset by the increase in operating, maintenance and management expenses of $23,718,762, the increase in real estate taxes and insurance of $17,250,299, the increase in depreciation and amortization expense of $21,226,999, the increase in interest expense of $16,062,444 and the increase in loss on debt extinguishment of $1,939,817. The decrease in our loss from continuing operations was due primarily to the increase in revenues from the acquisition of 33 multifamily properties during 2013 that experienced a full year of operations in 2014, as well as fewer acquisition related expenses incurred in 2014 with the acquisition of seven multifamily properties in 2014 compared to 33 multifamily properties acquired during 2013.

Total revenues

Rental income and tenant reimbursements for the year ended December 31, 2014 were $195,929,856 compared to $109,101,517 for the year ended December 31, 2013. The increase of $86,828,339 was primarily due to the fact that we owned 65 multifamily properties as of December 31, 2014 compared to 63 multifamily properties as of December 31, 2013. In addition, 33 of our multifamily properties acquired during the year ended December 31, 2013 experienced a full year of operations in 2014. Our total units increased by 667 from 15,859 at December 31, 2013 to 16,526 at December 31, 2014 and average monthly rents increased from $897 at December 31, 2013 to $966 at December 31, 2014. We expect rental income and tenant reimbursements to increase in future periods as a result of ordinary monthly rent increases and our value-enhancement strategy.

Operating, maintenance and management

Operating, maintenance and management expenses for the year ended December 31, 2014 were $52,427,001 compared to $28,708,239 for the year ended December 31, 2013. The increase of $23,718,762 was primarily due to the fact that we operated 65 multifamily properties as of December 31, 2014 compared to 63 multifamily properties as of December 31, 2013. In addition, 33 of our multifamily properties acquired during the year ended December 31, 2013 experienced a full year of operations in 2014. We expect that these amounts will decrease as a percentage of total revenues as we stabilize our property portfolio and implement operational efficiencies at our multifamily properties.

Real estate taxes and insurance

Real estate taxes and insurance expenses for the year ended December 31, 2014 were $34,750,097 compared to $17,499,798 for the year ended December 31, 2013. The increase of $17,250,299 was primarily due to the acquisition of seven multifamily properties since December 31, 2013, the continuing operation of the properties owned as of December 31, 2013, ordinary municipal property tax increases and increases in the assessed value of our property portfolio. We expect these amounts to increase in future periods as a result of ordinary municipal property tax increases as well as increases in the assessed value of our property portfolio.

Fees to affiliates

Fees to affiliates for the year ended December 31, 2014 were $23,923,921 compared to $30,713,737 for the year ended December 31, 2013. The decrease of $6,789,816 was primarily due to acquisition fees of $3,251,400 earned by our advisor in connection with the acquisition of seven multifamily properties with an aggregate purchase price of $130,339,157 during the year ended December 31, 2014, compared to acquisition fees of $19,148,107 earned by our advisor in connection with the acquisition of 33 multifamily properties with an aggregate purchase price of $945,680,000 during the year ended December 31, 2013. This decrease was partially offset by investment management fees of $13,252,309 earned by our advisor during the year ended December 31, 2014 in connection with managing our portfolio of 65 multifamily properties, compared to investment management fees of $7,409,393 earned during the year ended December 31, 2013 in connection with managing our portfolio of 63 multifamily properties. We expect fees to affiliates to decrease in future periods as a result of the decrease in anticipated future acquisitions of real estate and real estate-related investments.

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Depreciation and amortization

Depreciation and amortization expenses for the year ended December 31, 2014 were $69,681,177 compared to $48,454,178 for the year ended December 31, 2013. The increase of $21,226,999 was primarily due to the net increase in depreciable and amortizable assets of $105,125,537 since December 31, 2013 from the 33 multifamily properties acquired during the year ended December 31, 2013 that experienced a full year of depreciation and amortization in 2014. We expect these amounts to increase slightly in future periods as a result of anticipated future enhancements to our real estate portfolio.

Interest expense

Interest expense for the year ended December 31, 2014 was $40,370,846 compared to $24,308,402 for the year ended December 31, 2013. The increase of $16,062,444 was primarily due to the net increase in the notes payable balance of $97,427,225 due to financing incurred in connection with the acquisition of seven multifamily properties during the year ended December 31, 2014 and the net increase in the notes payable balance of $573,527,412 from financing incurred in connection with the acquisition of 33 multifamily properties acquired during the year ended December 31, 2013 that experienced a full year of interest expense in 2014. Included in interest expense is the amortization of deferred financing costs of $1,489,834 and $976,198 and amortization of loan premiums and discounts of $1,234,793 and $987,970 for the years ended December 31, 2014 and 2013, respectively. Also included in interest expense is the unrealized loss on derivative instruments of $4,353,301 and $448,984 for the years ended December 31, 2014 and 2013, respectively. Our interest expense in future periods will vary based on our level of borrowings, which will depend on the availability and cost of debt financing, the opportunity to acquire real estate and real estate-related investments meeting our investment objectives and the opportunity to sell real properties and real estate-related investments.

Loss on debt extinguishment

Loss on debt extinguishment for the year ended December 31, 2014 was $1,939,817 compared to $0 for the year ended December 31, 2013. These expenses consisted of prepayment penalties and the expense of the deferred financing costs, net related to the repayment and extinguishment of the debt in conjunction with the sale of the Lincoln Tower Apartments, Arbor Pointe Apartments and Prairie Walk Apartments. We expect loss on debt extinguishment may increase in future periods if we repay the remaining outstanding principal on properties that are sold prior to the scheduled maturity dates of the mortgage notes payable.

General and administrative expenses

General and administrative expenses for the year ended December 31, 2014 were $6,896,519 compared to $7,106,568 for the year ended December 31, 2013. These general and administrative costs consisted primarily of legal fees, insurance premiums, audit fees, other professional fees, independent director compensation and certain state taxes. The general and administrative expenses were consistent, with no meaningful changes from the year ended December 31, 2013 to the year ended December 31, 2014. We expect general and administrative expenses incurred by our advisor to decrease as a percentage of total revenue.

Acquisition costs

Acquisition costs for the year ended December 31, 2014 were $1,626,904 compared to $8,169,451 for the year ended December 31, 2013. The decrease in acquisition costs related primarily to our acquisition of seven multifamily properties during 2014 compared to 33 acquisitions of multifamily properties during 2013. We expect acquisition costs to decrease in future periods as we expect to acquire substantially fewer real properties and real estate-related investments in future periods.

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Consolidated Results of Operations for the Year Ended December 31, 2013 Compared to the Year Ended December 31, 2012

The following table summarizes the consolidated results of operations for the years ended December 31, 2013 and 2012:

	For the Years Ended December 31,
	2013			2012			Change $			Change %
Total revenues	$	109,101,517		$	30,586,932		$	78,514,585		256.7	%
Operating, maintenance and management	(28,708,239		)	(8,687,480		)	(20,020,759		)	230.5	%
Real estate taxes and insurance	(17,499,798		)	(3,721,952		)	(13,777,846		)	370.2	%
Fees to affiliates	(30,713,737		)	(13,127,558		)	(17,586,179		)	134.0	%
Depreciation and amortization	(48,454,178		)	(14,957,857		)	(33,496,321		)	223.9	%
Interest expense	(24,308,402		)	(6,291,193		)	(18,017,209		)	286.4	%
General and administrative expenses	(7,106,568		)	(3,085,470		)	(4,021,098		)	130.3	%
Acquisition costs	(8,169,451		)	(3,275,349		)	(4,894,102		)	149.4	%
Loss from continuing operations	$	(55,858,856	)	$	(22,559,927	)	$	(33,298,929	)	147.6	%
NOI(1)	$	58,737,243		$	17,069,028		$	41,668,215		244.1	%
FFO(2)	$	(7,404,678	)	$	(7,602,070	)	$	197,392		2.6	%
MFFO(2)	$	19,253,075		$	5,828,557		$	13,424,518		230.3	%

________________

(1) For information on how we calculate NOI and a reconciliation of NOI to net loss, see “—Net Operating Income.”

(2) For information on how we calculate FFO and MFFO and a reconciliation of FFO and MFFO to net loss, see “—Funds From Operations and Modified Funds From Operations.”

Loss from continuing operations

For the year ended December 31, 2013, we had a loss from continuing operations of $55,858,856 compared to a loss from continuing operations of $22,559,927 for the year ended December 31, 2012. The increase in net loss of $33,319,930 over the prior year was primarily due to the increase in operating, maintenance and management expenses of $20,020,759, the increase in real estate taxes and insurance of $13,777,846, the increase in fees to affiliates of $17,586,179, the increase in depreciation and amortization expense of $33,496,321, the increase in interest expense of $18,017,209, the increase in general and administrative expenses of $4,021,098 and the increase in acquisition costs of $4,894,102, partially offset by the increase in total revenues of $78,514,585. The increase in our expenses was due primarily to the increase in our property portfolio from 30 properties at December 31, 2012 to 63 properties at December 31, 2013.

Total revenues

Rental income and tenant reimbursements for the year ended December 31, 2013 were $109,101,517 compared to $30,586,932 for the year ended December 31, 2012. The increase of $78,514,585 was primarily due to the fact that we owned 63 multifamily properties at December 31, 2013 compared to 30 multifamily properties at December 31, 2012. Our total units increased by 9,167 from 6,692 at December 31, 2012 to 15,859 at December 31, 2013 and average monthly rents increased from $825 at December 31, 2012 to $897 at December 31, 2013.

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Operating, maintenance and management

Operating, maintenance and management expenses for the year ended December 31, 2013 were $28,708,239 compared to $8,687,480 for the year ended December 31, 2012. The increase of $20,020,759 was primarily due to the fact that we operated 63 multifamily properties as of December 31, 2013 compared to 30 multifamily properties as of December 31, 2012.

Real estate taxes and insurance

Real estate taxes and insurance expenses for the year ended December 31, 2013 were $17,499,798 compared to $3,721,952 for the year ended December 31, 2012. The increase of $13,777,846 was due to the acquisition of 33 multifamily properties during 2013 and the continuing operation of the properties owned as of December 31, 2012.

Fees to affiliates

Fees to affiliates for the year ended December 31, 2013 were $30,713,737 compared to $13,127,558 for the year ended December 31, 2012. The increase of $17,586,179 was primarily due to acquisition fees of $19,148,107 earned by our advisor in connection with the acquisition of 33 multifamily properties with an aggregate purchase price of $945,680,000 during the year ended December 31, 2013, compared to acquisition fees of $10,131,220 earned by our advisor in connection with the acquisition of 22 multifamily properties with an aggregate purchase price of $501,240,000 during the year ended December 31, 2012. Additionally, the property management and investment management fees payable to our affiliated property manager and advisor increased for the year ended December 31, 2013 as a result of the growth of our property portfolio.

Depreciation and amortization

Depreciation and amortization expenses for the year ended December 31, 2013 were $48,454,178 compared to $14,957,857 for the year ended December 31, 2012. The increase of $33,496,321 was primarily due to the net increase in depreciable and amortizable assets of $829,760,433 during the year ended December 31, 2013.

Interest expense

Interest expense for the year ended December 31, 2013 was $24,308,402 compared to $6,291,193 for the year ended December 31, 2012. The increase of $18,017,209 was primarily due to the net increase in the notes payable balance of $573,527,412 due to financing incurred in connection with the acquisition of 33 multifamily properties during the year ended December 31, 2013. Included in interest expense is the amortization of deferred financing costs of $976,198 and $225,614 and amortization of loan premiums of $987,970 and $332,348 for the years ended December 31, 2013 and 2012, respectively. Also included in interest expense is the unrealized loss on derivative instruments of $448,984 and 162,761 for the years ended December 31, 2013 and 2012, respectively.

General and administrative expense

General and administrative expenses for the year ended December 31, 2013 were $7,106,568 compared to $3,085,470 for the year ended December 31, 2012. These general and administrative costs consisted primarily of legal fees, insurance premiums, audit fees, other professional fees and independent director compensation. The increase of $4,021,098 was primarily due to the reimbursement of the previously deferred operating costs incurred by our advisor on our behalf totaling $2,571,910 as well as increases in legal, audit and other professional fees incurred in connection with the growth of our portfolio.

Acquisition costs

Acquisition costs for the year ended December 31, 2013 were $8,169,451 compared to $3,275,349 for the year ended December 31, 2012. The increase in acquisition costs of $4,894,102 related primarily to our acquisition of 33 multifamily properties during 2013 compared to 22 acquisitions of multifamily properties during 2012.

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Property Operations for the Three Months Ended December 31, 2014 Compared to the Three Months Ended December 31, 2013

For purposes of evaluating comparative operating performance for the fourth quarter, we categorize our properties as “same-store” or “non-same-store.” A “same-store” property is a property that was owned at October 1, 2013. A “non-same-store” property is a property that was acquired, placed into service or disposed of after October 1, 2013.

The following table presents the same-store and non-same-store results from operations for the three months ended December 31, 2014 and 2013:

	For the Three Months Ended December 31,
	2014		2013		Change $			Change %
Same-store properties:
Revenues	$	35,377,803	$	33,012,452	$	2,365,351		7	%
Operating expenses	15,593,950		16,654,979		(1,061,029		)	(6	)%
Net operating income	19,783,853		16,357,473		3,426,380			21	%
Non-same-store properties:
Net operating income	8,073,351		3,301,040		4,772,311
Total net operating income(1)	$	27,857,205	$	19,658,513	$	8,198,692

________________

(1) See “—Net Operating Income” below for a reconciliation of NOI to net income (loss).

Net Operating Income

Same-store net operating income for the three months ended December 31, 2014 was $19,783,853 compared to $16,357,473 for the three months ended December 31, 2013. The 21%increase in same-store net operating income was primarily due to the 7%increase in same-store rental revenues and a 6%decrease in same-store operating expenses over the comparable prior year period.

Revenues

Same-store revenues for the three months ended December 31, 2014 were $35,377,803 compared to $33,012,452 for the three months ended December 31, 2013. The 7%increase in same-store revenues was primarily due to the increase in same-store occupancy from 92.2% as of December 31, 2013 to 94.0% as of December 31, 2014 coupled with average rent increases at the same-store properties from $892 as of December 31, 2013 to $934 as of December 31, 2014.

Operating Expenses

Same-store operating expenses for the three months ended December 31, 2014 were $15,593,950 compared to $16,654,979 for the three months ended December 31, 2013. The 6%decrease in same-store operating expenses was primarily due to a reduction in the property tax expense from negotiating reduced assessed values at certain multifamily properties in our portfolio. The same-store operating expenses would have decreased by $117,566, or 1%, and same-store NOI would have increased by 15% had the reduction in property taxes been recorded at a normalized rate over the periods presented.

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Net Operating Income

Net Operating Income, or NOI, is a non-GAAP financial measure of performance. NOI is used by investors and our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by (1) the cost of funds, (2) acquisition costs, (3) non-operating fees to affiliates, (4) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, or (5) general and administrative expenses and other gains and losses that are specific to us. The cost of funds is eliminated from net income (loss) because it is specific to our particular financing capabilities and constraints. The cost of funds is also eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital which may have changed or may change in the future. Acquisition costs and non-operating fees to affiliates are eliminated because they do not reflect our continuing operating costs.

Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our multifamily properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly timed purchases or sales. We believe that eliminating these costs from net income is useful because the resulting measure captures the actual revenue generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

The usefulness of NOI is limited because it excludes general and administrative costs, interest expense, interest income and other expense, acquisition costs, certain fees to affiliates, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income which further limits its usefulness.

NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income (loss) as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income (loss) computed in accordance with GAAP and discussions elsewhere in “—Results of Operations” regarding the components of net income (loss) that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.

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The following is a reconciliation of our NOI to net loss for the three months ended December 31, 2014 and 2013 and for the years ended December 31, 2014, 2013 and 2012 computed in accordance with GAAP:

	For the Three Months Ended December 31,						For the Year Ended December 31,
	2014			2013			2014			2013			2012
Net loss	$	(4,668,129	)	$	(24,834,740	)	$	(25,742,292	)	$	(55,879,857	)	$	(22,559,927	)
Fees to affiliates(1)	3,789,171			10,754,705			16,503,709			26,557,500			12,019,086
Depreciation and amortization	16,043,489			18,161,218			69,681,177			48,454,178			14,957,857
Interest expense	10,077,924			8,438,975			40,370,846			24,308,402			6,291,193
Loss on debt extinguishment	—			—			1,939,817			—			—
General and administrative expenses	2,343,992			4,240,862			6,896,519			7,106,568			3,085,470
Acquisition costs	270,758			2,876,492			1,626,904			8,169,451			3,275,349
Loss (gain) on sales of real estate	—			21,001			(9,944,134		)	21,001			—
Net operating income	$	27,857,205		$	19,658,513		$	101,332,546		$	58,737,243		$	17,069,028

________________

(1) Fees to affiliates for the three and twelve months ended December 31, 2014 excludes property management fees of $1,501,010 and $5,802,772 and other fees of $400,552 and $1,617,440, respectively, that are included in NOI. Fees to affiliates for the three and twelve months ended December 31, 2013 excludes property management fees of $1,150,804 and $3,226,878 and other fees of $348,792 and $929,359, respectively, that are included in NOI. Fees to affiliates for the year ended December 31, 2012 excludes property management fees of $960,968 and other fees of $147,504 that are included in NOI.

Funds from Operations and Modified Funds from Operations

Due to certain unique operating characteristics of real estate companies, as discussed below, NAREIT, an industry trade group, has promulgated a measure known as funds from operations, or FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a real estate investment trust, or REIT. The use of FFO is recommended by the REIT industry as a supplemental performance measure. FFO is not equivalent to our net income (loss) as determined under GAAP.

We define FFO, a non-GAAP financial measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as revised in February 2004, or the White Paper. The White Paper defines FFO as net income (loss) computed in accordance with GAAP, excluding gains or losses from sales of property and non-cash impairment charges of real estate related investments, plus real estate related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. In particular, we believe it is appropriate to disregard impairment charges, as this is a fair value adjustment that is largely based on market fluctuations and assessments regarding general market conditions which can change over time. An asset will only be evaluated for impairment if certain impairment indications exist and if the carrying, or book value, exceeds the total estimated undiscounted future cash flows (including net rental and lease revenues, net proceeds on the sale of the property, and any other ancillary cash flows at a property or group level under GAAP) from such asset. Investors should note, however, that determinations of whether impairment charges have been incurred are based partly on anticipated operating performance, because estimated undiscounted future cash flows from a property, including estimated future net rental and lease revenues, net proceeds on the sale of the property, and certain other ancillary cash flows, are taken into account in determining whether an impairment charge has been incurred. While impairment charges are excluded from the calculation of FFO as described above, investors are cautioned that due to the fact that impairments are based on estimated future undiscounted cash flows and the relatively limited term of our operations, it could be difficult to recover any impairment charges. Our FFO calculation complies with NAREIT’s policy described above.

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The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time, especially if such assets are not adequately maintained or repaired and renovated as required by relevant circumstances and/or as requested or required by lessees for operational purposes in order to maintain the value disclosed. We believe that since real estate values historically rise and fall with market conditions, including inflation, interest rates, the business cycle, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income. However, FFO, and MFFO as described below, should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO and MFFO measures and the adjustments to GAAP in calculating FFO and MFFO.

Changes in the accounting and reporting promulgations under GAAP (for acquisition fees and expenses from a capitalization/depreciation model to an expensed-as-incurred model) that were put into effect in 2009 and other changes to GAAP accounting for real estate subsequent to the establishment of NAREIT’s definition of FFO have prompted an increase in cash-settled expenses, specifically acquisition fees and expenses for all industries as items that are expensed under GAAP, that are typically accounted for as operating expenses. Management believes these fees and expenses do not affect our overall long-term operating performance. Publicly registered, non-listed REITs typically have a significant amount of acquisition activity and are substantially more dynamic during their initial years of investment and operation. While other start-up entities may also experience significant acquisition activity during their initial years, we believe that public, non-listed REITs, like us, are unique in that they have a limited life with targeted exit strategies within a relatively limited time frame after acquisition activity ceases. Our board of directors will determine to pursue a liquidity event when it believes that the then-current market conditions are favorable. Thus, as a limited life REIT, we will not continuously purchase assets and will have a limited life.

Due to the above factors and other unique features of publicly registered, non-listed REITs, the Investment Program Association, or IPA, an industry trade group, has standardized a measure known as MFFO, which the IPA has recommended as a supplemental measure for publicly registered non-listed REITs and which we believe to be another appropriate supplemental measure to reflect the operating performance of a public, non-listed REIT having the characteristics described above. MFFO is not equivalent to our net income or loss as determined under GAAP, and MFFO may not be a useful measure of the impact of long-term operating performance on value if we do not continue to operate with a limited life and targeted exit strategy, as currently intended. We believe that, because MFFO excludes costs that we consider more reflective of investing activities and other non-operating items included in FFO and also excludes acquisition fees and expenses that affect our operations only in periods in which properties are acquired, MFFO can provide, on a going forward basis, an indication of the sustainability (that is, the capacity to continue to be maintained) of our operating performance after the period in which we are acquiring our properties and once our portfolio is in place. By providing MFFO, we believe we are presenting useful information that assists investors and analysts to better assess the sustainability of our operating performance after our offering has been completed and our properties have been acquired. We also believe that MFFO is a recognized measure of sustainable operating performance by the non-listed REIT industry. Further, we believe MFFO is useful in comparing the sustainability of our operating performance after our offering and acquisitions are completed with the sustainability of the operating performance of other real estate companies that are not as involved in acquisition activities. Investors are cautioned that MFFO should only be used to assess the

sustainability of our operating performance after our offering has been completed and properties have been acquired, as it excludes acquisition costs that have a negative effect on our operating performance during the periods in which properties are acquired.

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We define MFFO, a non-GAAP financial measure, consistent with the IPA’s Guideline 2010-01, Supplemental Performance Measure for Publicly Registered, Non-Listed REITs: Modified Funds from Operations, or the Practice Guideline, issued by the IPA in November 2010. The Practice Guideline defines MFFO as FFO further adjusted for the following items, as applicable, included in the determination of GAAP net income: acquisition fees and expenses; amounts relating to deferred rent receivables and amortization of above and below market leases and liabilities (which are adjusted in order to reflect such payments from a GAAP accrual basis to a cash basis of disclosing the rent and lease payments); accretion of discounts and amortization of premiums on debt investments; mark-to-market adjustments included in net income; nonrecurring gains or losses included in net income from the extinguishment or sale of debt, hedges, foreign exchange, derivatives or securities holdings where trading of such holdings is not a fundamental attribute of the business plan, unrealized gains or losses resulting from consolidation from, or deconsolidation to, equity accounting, and after adjustments for consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated to reflect MFFO on the same basis. The accretion of discounts and amortization of premiums on debt investments, nonrecurring unrealized gains and losses on hedges, foreign exchange, derivatives or securities holdings, unrealized gains and losses resulting from consolidations, as well as other listed cash flow adjustments are adjustments made to net income in calculating the cash flows provided by operating activities and, in some cases, reflect gains or losses which are unrealized and may not ultimately be realized. While we rely on our advisor for managing interest rate, hedge and foreign exchange risk, we do not retain an outside consultant to review all our hedging agreements. Inasmuch as interest rate hedges are not a fundamental part of our operations, we believe it is appropriate to exclude such non-recurring gains and losses in calculating MFFO, as such gains and losses are not reflective of on-going operations.

Our MFFO calculation complies with the IPA’s Practice Guideline described above. In calculating MFFO, we exclude acquisition related expenses, amortization of above and below market leases, fair value adjustments of derivative financial instruments, deferred rent receivables and the adjustments of such items related to noncontrolling interests. Under GAAP, acquisition fees and expenses are characterized as operating expenses in determining operating net income. These expenses are paid in cash by us. All paid and accrued acquisition fees and expenses will have negative effects on returns to investors, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of other properties are generated to cover the purchase price of the property, these fees and expenses and other costs related to such property. In the event that operational earnings and cash flow are not available to fund our reimbursement of acquisition fees and expenses incurred by our advisor, such fees and expenses will need to be reimbursed to our advisor from other sources, including debt, net proceeds from the sale of properties, or from ancillary cash flows. The acquisition of properties, and the corresponding acquisition fees and expenses, is the key operational feature of our business plan to generate operational income and cash flow to fund distributions to our stockholders. Further, under GAAP, certain contemplated non-cash fair value and other non-cash adjustments are considered operating non-cash adjustments to net income in determining cash flow from operating activities. In addition, we view fair value adjustments of derivatives and gains and losses from dispositions of assets as non-recurring items or items which are unrealized and may not ultimately be realized, and which are not reflective of on-going operations and are therefore typically adjusted for when assessing operating performance.

Our management uses MFFO and the adjustments used to calculate MFFO in order to evaluate our performance against other public, non-listed REITs which have limited lives with short and defined acquisition periods and targeted exit strategies shortly thereafter. As noted above, MFFO may not be a useful measure of the impact of long-term operating performance on value if we do not continue to operate in this manner. We believe that our use of MFFO and the adjustments used to calculate MFFO allow us to present our performance in a manner that reflects certain characteristics that are unique to public, non-listed REITs, such as their limited life, limited and defined acquisition period and targeted exit strategy, and hence that the use of such measures is useful to investors. By excluding expensed acquisition costs, the use of MFFO provides information consistent with management’s analysis of the operating performance of the properties. Additionally, fair value adjustments, which are based on

the impact of current market fluctuations and underlying assessments of general market conditions, but can also result from operational factors such as rental and occupancy rates, may not be directly related or attributable to our current operating performance. By excluding such changes that may reflect anticipated and unrealized gains or losses, we believe MFFO provides useful supplemental information.

Presentation of this information is intended to provide useful information to investors as they compare our operating performance to that of other public, non-listed REITs, although it should be noted that not all public, non-listed REITs calculate FFO and MFFO the same way, so comparisons with other public, non-listed REITs may not be meaningful. Furthermore, FFO and MFFO are not necessarily indicative of cash flow available to fund cash needs and should not be considered as an

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alternative to net income (loss) or income (loss) from continuing operations as an indication of our performance, as an alternative to cash flows from operations as an indication of our liquidity, or indicative of funds available to fund our cash needs, including our ability to make distributions to our stockholders. FFO and MFFO should be reviewed in conjunction with GAAP measurements as an indication of our performance. MFFO has limitations as a performance measure where there is no regular net asset value determination of us. MFFO is useful in assisting management and investors in assessing the sustainability of operating performance in future operating periods, and in particular, after the offering and acquisition stages are complete and net asset value is disclosed. MFFO is not a useful measure in evaluating net asset value because impairments are taken into account in determining net asset value but not in determining MFFO.

Neither the SEC, NAREIT nor any other regulatory body has passed judgment on the acceptability of the adjustments that we use to calculate FFO or MFFO. In the future, the SEC, NAREIT or another regulatory body may decide to standardize the allowable adjustments across the non-listed REIT industry and in response to such standardization we may have to adjust our calculation and characterization of FFO or MFFO accordingly.

Our calculation of FFO and MFFO is presented in the following table for the years ended December 31, 2014, 2013 and 2012:

	For the Years Ended December 31,
Reconciliation of net loss to MFFO:	2014			2013			2012
Net loss	$	(25,742,292	)	$	(55,879,857	)	$	(22,559,927	)
Depreciation of real estate assets	59,014,085			32,103,974			8,353,542
Amortization of lease-related costs	10,667,092			16,350,204			6,604,315
(Gain) loss on sales of real estate, net	(9,944,134		)	21,001			—
FFO	33,994,751			(7,404,678		)	(7,602,070		)
Acquisition fees and expenses(1)(2)	4,878,304			27,317,558			13,406,569
Unrealized loss on derivative instruments	4,353,301			448,984			162,761
Loss on debt extinguishment	1,939,817			—			—
Amortization of below-market leases	(163,237		)	(1,108,789		)	(138,703		)
MFFO	$	45,002,936		$	19,253,075		$	5,828,557
FFO per share - basic and diluted	$	0.45		$	(0.18	)	$	(0.62	)
MFFO per share - basic and diluted	0.60			0.48			0.48
Loss per common share - basic and diluted	(0.34		)	(1.39		)	(1.84		)
Weighted average number of common shares outstanding, basic and diluted	75,450,215			40,169,940			12,238,094

________________

(1) By excluding acquisition fees and expenses, management believes MFFO provides useful supplemental information that is comparable for each type of real estate investment and is consistent with management’s analysis of the investing and operating performance of our properties. Acquisition fees and expenses include payments to our advisor or third parties. Acquisition fees and expenses under GAAP are considered operating expenses and as expenses included in the determination of net income (loss) and income (loss) from continuing operations, both of which are performance measures under GAAP. All paid and accrued acquisition fees and expenses will have negative effects on returns to investors, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of properties are generated to cover the purchase price of the property, these fees and expenses and other costs related to the property. In the event that proceeds from our initial public offering are not available to fund our reimbursement of acquisition fees and expenses incurred by our advisor, such fees and expenses will need to be reimbursed to the advisor from other sources, including debt, operational earnings or cash flow, net proceeds from the sale of properties, or from ancillary cash flows.

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(2) Acquisition fees and expenses for the years ended December 31, 2014, 2013 and 2012 includes acquisition fees of $3,251,400, $19,148,107 and $10,131,220, respectively, that are recorded in fees to affiliates in the accompanying consolidated statements of operations and acquisition expenses of $1,626,904, $8,169,451 and $3,275,349, respectively, that are recorded in acquisition costs in the accompanying consolidated statements of operations.

FFO and MFFO may be used to fund all or a portion of certain capitalizable items that are excluded from FFO and MFFO, such as tenant improvements, building improvements and deferred leasing costs.

Inflation

Substantially all of our multifamily property leases are for a term of one year or less. In an inflationary environment, this may allow us to realize increased rents upon renewal of existing leases or the beginning of new leases. Short-term leases generally will minimize our risk from the adverse effects of inflation, although these leases generally permit residents to leave at the end of the lease term and therefore will expose us to the effects of a decline in market rents. In a deflationary rent environment, we may be exposed to declining rents more quickly under these shorter term leases.

With respect to other commercial properties, we currently include, and expect in the future to include, provisions in our leases designed to protect us from the impact of inflation. These provisions will include reimbursement billings for operating expense pass-through charges, real estate tax and insurance reimbursements, or in some cases annual reimbursement of operating expenses above a certain allowance. We believe that shorter term lease contracts lessen the impact of inflation due to the ability to adjust rental rates to market levels as leases expire.

As of December 31, 2014, we had not entered into any leases as a lessee.

REIT Compliance

To qualify as a REIT for tax purposes, we are required to distribute at least 90% of our REIT taxable income (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP) to our stockholders. We must also meet certain asset and income tests, as well as other requirements. We monitor the business and transactions that may potentially impact our REIT status. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates.

Distributions

Our board of directors has declared daily distributions that are paid on a monthly basis. We expect to continue paying monthly distributions unless our results of operations, our general financial condition, general economic conditions or other factors prohibit us from doing so. We may declare distributions in excess of our cash from operations. As a result, our distribution rate and payment frequency may vary from time to time. However, to qualify as a REIT for tax purposes, we must make distributions equal to at least 90% of our REIT taxable income each year.

Distributions (1) accrue daily to our stockholders of record as of the close of business on each day, (2) are payable in cumulative amounts on or before the third day of each calendar month with respect to the prior month and (3) are calculated at a rate of $0.001964 per share per day, which if paid each day over a 365-day period is equivalent to a 7% annualized distribution rate based on a purchase price of $10.24 per share of common stock. Prior to September 10, 2012, distributions were calculated at a rate of $0.001917 per share of common stock, which was equivalent to a 7% annualized distribution rate based on a purchase price of $10.00 per share of common stock. There is no guaranty that we will pay distributions at this rate in the future if at all.

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Distributions declared and paid were as follows for the year ended December 31, 2014:

Period	Distributions Declared(1)		Distributions Declared Per Share(1)(2)		Distributions Paid(3)						Net Cash Provided By Operating Activities
					Cash		Reinvested(4)		Total
First Quarter 2014	$	13,174,851	$	0.177	$	6,455,864	$	6,227,486	$	12,683,350	$	7,784,361
Second Quarter 2014	13,454,087		0.179		6,834,399		6,709,523		13,543,922		9,503,118
Third Quarter 2014	13,785,040		0.181		6,993,862		6,743,864		13,737,726		15,165,296
Fourth Quarter 2014	13,882,686		0.181		9,207,864		4,502,799		13,710,663		16,104,072
	$	54,296,664	$	0.718	$	29,491,989	$	24,183,672	$	53,675,661	$	48,556,847

________________

(1) Distributions are based on daily record dates and calculated at a rate of $0.001964 per share per day.

(2) Assumes each share was issued and outstanding each day during the periods presented.

(3) Distributions are paid on a monthly basis. Distributions for all record dates of a given month are paid approximately three days following month end.

(4) Our distribution reinvestment plan was suspended by our board of directors effective November 20, 2014.

For the year ended December 31, 2014, we paid aggregate distributions of $53,675,661, comprised of $29,491,989 of distributions paid in cash and 2,485,476 shares of our common stock issued pursuant to our distribution reinvestment plan for $24,183,672. For the year ended December 31, 2014, we had a net loss of $25,742,292. We had FFO for the year ended December 31, 2014 of $33,994,751 and net cash provided by operating activities was $48,556,847. For the year ended December 31, 2014, we funded $44,735,868 of distributions paid, which includes net cash distributions and dividends reinvested by stockholders, with net cash provided by operating activities and with proceeds from our public offering of $8,939,793. See the reconciliation of FFO to net loss above in “—Funds from Operations and Modified Funds from Operations.”

Over the long-term, we expect that a greater percentage of our distributions will be paid from cash flow from operations and FFO (except with respect to distributions related to sales of our real estate investments). However, our operating performance cannot be accurately predicted and may deteriorate in the future due to numerous factors, including those discussed under “Risk Factors,” and “—Results of Operations.”

Off-Balance Sheet Arrangements

As of December 31, 2014 and 2013, we had no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Related-Party Transactions and Agreements

We have entered into agreements with our advisor and its affiliates, whereby we have paid, and may continue to pay, certain fees to, or reimburse certain expenses of, our advisor or its affiliates for acquisition and advisory fees and expenses, financing coordination fees, organization and offering costs, sales commissions, dealer manager fees, asset and property management fees and expenses, leasing fees and reimbursement of certain operating costs. See Item 13. “Certain Relationships and Related Transactions, Director Independence” and Note 8 (Related Party Arrangements) to the consolidated financial statements included in this annual report for a discussion of the various related-party transactions, agreements and fees.

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Critical Accounting Policies

Below is a discussion of the accounting policies that we believe are critical because they involve significant judgments and assumptions, require estimates about matters that are inherently uncertain and because they are important for understanding and evaluating our reported financial results. These judgments affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our financial statements. Other companies may utilize different estimates that may impact the comparability of our results of operations to those of companies in similar businesses.

Real Estate Assets

Depreciation and Amortization

Real estate costs related to the development, construction and improvement of properties are capitalized. Acquisition costs related to business combinations are expensed as incurred. Acquisition costs related to asset acquisitions are capitalized. Repair and maintenance and tenant turnover costs are charged to expense as incurred and significant replacements and betterments are capitalized. Repair and maintenance and tenant turnover costs include all costs that do not extend the useful life of the real estate asset. We consider the period of future benefit of an asset to determine its appropriate useful life and anticipate the estimated useful lives of assets by class to be generally as follows:

Buildings	27.5 years
Building improvements	5-25 years
Tenant improvements	Shorter of lease term or expected useful life
Tenant origination and absorption costs	Remaining term of related lease
Furniture, fixtures, and equipment	5-10 years

Real Estate Purchase Price Allocation

We record the acquisition of income-producing real estate or real estate that will be used for the production of income as a business combination. All assets acquired and liabilities assumed in a business combination are measured at their acquisition-date fair values. Acquisition costs are expensed as incurred.

We assess the acquisition-date fair values of all tangible assets, identifiable intangible assets and assumed liabilities using methods similar to those used by independent appraisers (e.g., discounted cash flow analysis) and that utilize appropriate discount and/or capitalization rates and available market information. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions. The fair value of tangible assets of an acquired property considers the value of the property as if it was vacant.

Intangible assets include the value of in-place leases, which represents the estimated value of the net cash flows of the in-place leases to be realized, 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 estimate the value of tenant origination and absorption costs by considering the estimated carrying costs during hypothetical expected lease-up periods, considering current market conditions. In estimating carrying costs, we estimate the amount of lost rentals using market rates during the expected lease-up periods.

We amortize the value of in-place leases to expense over the remaining non-cancelable term of the respective leases. Should a tenant terminate its lease, the unamortized portion of the in-place lease value and customer relationship intangibles would be charged to expense in that period.

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We record above-market and below-market in-place lease values for acquired properties, if any, based on the present value (using an interest rate that reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) our estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease. We amortize any capitalized above-market or below-market lease values as a reduction or increase to rental income over the remaining non-cancelable terms of the respective leases.

Estimates of the fair values of the tangible assets, identifiable intangible assets 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, and the number of years the property will be held for investment. The use of inappropriate assumptions could result in an incorrect valuation of acquired tangible assets, identifiable intangible assets and assumed liabilities, which could impact the amount of our net income (loss).

Sale of Real Estate Assets

We record property sales or dispositions when title transfers to unrelated third parties, contingencies have been removed and sufficient cash consideration has been received by us. Upon disposition, the related costs and accumulated depreciation are removed from the respective accounts. Any gain or loss on sale is recognized in accordance with GAAP.

We classify real estate assets as real estate held for sale once the criteria, as defined by GAAP, have been met.

Impairment of Real Estate Assets

We continually monitor events and changes in circumstances that could indicate that the carrying amounts of our real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets and liabilities may not be recoverable, we assess the recoverability of the assets by estimating whether we will recover the carrying value of the asset through its undiscounted future cash flows and its eventual disposition. Based on this analysis, if we do not believe that we will be able to recover the carrying value of the real estate and related intangible assets and liabilities, we record an impairment loss to the extent that the carrying value exceeds the estimated fair value of the real estate and related intangible assets and liabilities. If any assumptions, projections or estimates regarding an asset changes in the future, we may have to record an impairment to reduce the net book value of such individual asset.

Rents and Other Receivables

We periodically evaluate the collectability of amounts due from tenants and maintain an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required payments under lease agreements. We exercise judgment in establishing these allowances and consider payment history and current credit status of tenants in developing these estimates. Due to the short-term nature of the operating leases, we do not maintain an allowance for deferred rent receivable related to the straight-lining of rents.

Revenue Recognition

We lease apartment and condominium units under operating leases with terms generally of one year or less. Generally, credit investigations are performed for prospective residents and security deposits are obtained. We recognize minimum rent, including rental abatements, concessions and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the related lease and amounts expected to be received in later years are recorded as deferred rents. We record property operating expense reimbursements due from tenants for common area maintenance, real estate taxes, and other recoverable costs in the period the related expenses are incurred.

We recognize gains on sales of real estate either in total or deferred for a period of time, depending on whether a sale has been consummated, the extent of the buyer’s investment in the property being sold, whether the receivable is subject to future subordination, and the degree of our continuing involvement with the property after the sale. If the criteria for profit recognition under the full-accrual method are not met, we will defer gain recognition and account for the continued operations of the property by applying the percentage-of-completion, reduced profit, deposit, installment or cost recovery method, as appropriate, until the appropriate criteria are met.

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Fair Value Measurements

Under GAAP, we are required to measure certain financial instruments at fair value on a recurring basis. In addition, we are required to measure other assets and liabilities at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories:

Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable.

When available, we utilize quoted market prices from an independent third-party source to determine fair value and will classify such items in Level 1 or Level 2. In instances where the market is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require us to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When we determine the market for a financial instrument we own to be illiquid or when market transactions for similar instruments do not appear orderly, we use several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and we establish a fair value by assigning weights to the various valuation sources.

Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument.

Accounting for Stock-Based Compensation

We amortize the fair value of stock-based compensation awards to expense over the vesting period and record any dividend equivalents earned as dividends for financial reporting purposes. Stock-based compensation awards are valued at the fair value on the date of grant and amortized as an expense over the vesting period.

Organization and Offering Costs

Organization and offering expenses include all expenses (other than sales commissions and related dealer manager fees) paid by us in connection with our initial public offering and our private offering, including legal, accounting, printing, mailing and filing fees, charges of our transfer agent, expenses of organizing us, data processing fees, advertising and sales literature costs, transfer agent costs, bona fide out-of-pocket due diligence costs and amounts to reimburse our advisor or its affiliates for the salaries of its employees and other costs in connection with preparing supplemental sales materials and providing other administrative services.

We may also reimburse costs of bona fide training and education meetings held by us (primarily travel, meal and lodging costs of registered representatives of broker-dealers), attendance and sponsorship fees and cost reimbursement of employees of our affiliates to attend seminars conducted by broker-dealers and, in certain cases, reimbursement to participating broker-dealers for technology costs associated with our initial public offering, costs and expenses related to such technology costs, and costs and expenses associated with the facilitation of the marketing of our shares and the ownership of our shares by such broker-dealers’ customers; provided, however, that we will not pay any of the foregoing costs to the extent that such payment would cause total underwriting compensation for our public offering to exceed 10% of the gross proceeds of our initial public offering, as required by the rules of FINRA.

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We are obligated to reimburse our advisor, the dealer manager, or their affiliates, as applicable, for organization and offering costs paid by them on our behalf, provided that the advisor would be obligated to reimburse us to the extent selling commissions, dealer manager fees and organization and offering costs incurred by us in our initial public offering exceed 15% of the gross offering proceeds of our initial public offering. Any reimbursement of expense paid to our advisor will not exceed actual expenses incurred by our advisor. No amounts were owed by the advisor pursuant to the advisory agreement.

Reimbursements to our advisor or our affiliates for offering costs paid by them on our behalf with respect to our private offering are not limited to 15% of the gross offering proceeds of our private offering. We had previously deferred $1,425,070 of private offering costs that were in excess of 15% of the gross offering proceeds. However, during the year ended December 31, 2013, the independent directors approved the reimbursement of these offering costs and we reimbursed our advisor for such costs.

Income Taxes

We have elected to be taxed as a REIT under the Internal Revenue Code beginning with the tax year ended December 31, 2010. To qualify as a REIT, we must meet certain organizational and operational requirements, including the requirement to distribute at least 90% of our annual REIT taxable income to our stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, we generally will not be subject to federal income tax to the extent we distribute qualifying dividends to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to our stockholders. However, we believe we are organized and operate in such a manner as to qualify for treatment as a REIT.

We follow the income tax guidance under GAAP to recognize, measure, present and disclose in our consolidated financial statements uncertain tax positions that we have taken or expect to take on a tax return. As of December 31, 2014 and 2013, we did not have any liabilities for uncertain tax positions that we believe should be recognized in our consolidated financial statements. Due to uncertainty regarding the realization of certain deferred tax assets, we have established valuation allowances, primarily in connection with the net operating loss carryforward related to the REIT. We have not been assessed interest or penalties by any major tax jurisdictions. Our evaluation was performed for the tax years ended December 31, 2014 and 2013. As of December 31, 2014, returns for calendar years 2013, 2012 and 2011 remain subject to examination by major tax jurisdictions.

Subsequent Events

Distributions Paid

On January 2, 2015, we paid distributions of $4,679,455, which related to distributions declared for each day in the period from December 1, 2014 through December 31, 2014. All such distributions were paid in cash.

On February 2, 2015, we paid distributions of $4,679,536, which related to distributions declared for each day in the period from January 1, 2015 through January 31, 2015. All such distributions were paid in cash.

On March 2, 2015, we paid distributions of $4,226,611, which related to distributions declared for each day in the period from February 1, 2015 through February 28, 2015. All such distributions paid in cash.

Estimated Value per Share

On March 10, 2015, our board of directors determined an estimated value per share of our common stock of $10.35 as of December 31, 2014.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We may be exposed to the effects of interest rate changes as a result of borrowings used to maintain liquidity and to fund the acquisition, expansion and refinancing of our real estate investment portfolio and operations. We may be also exposed to the effects of changes in interest rates as a result of the acquisition and origination of mortgage, mezzanine, bridge and other loans. Our profitability and the value of our investment portfolio may be adversely affected during any period as a result of interest rate changes. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings, prepayment penalties and cash flows and to lower overall borrowing costs. We have managed and will continue to manage interest rate risk by maintaining a ratio of fixed rate, long-term debt such that floating rate exposure is kept at an acceptable level. In addition, we may utilize a variety of financial instruments, including interest rate caps, collars, floors and swap agreements, in order to limit the effects of changes in interest rates on our operations. When we use these types of derivatives to hedge the risk of interest-earning assets or interest-bearing liabilities, we may be subject to certain risks, including the risk that losses on a hedge position will reduce the funds available for payments to holders of our common stock and that the losses may exceed the amount we invested in the instruments.

We borrow funds and make investments at a combination of fixed and variable rates. Interest rate fluctuations will generally not affect our future earnings or cash flows on our fixed rate debt unless such instruments mature or are otherwise terminated. However, interest rate changes will affect the fair value of our fixed rate instruments. At December 31, 2014, the fair value of our fixed rate debt was $486,484,963 and the carrying value of our fixed rate debt was $481,090,989. The fair value estimate of our fixed rate debt was estimated using a discounted cash flow analysis utilizing rates we would expect to pay for debt of a similar type and remaining maturity if the loans were originated at December 31, 2014. As we expect to hold our fixed rate instruments to maturity and the amounts due under such instruments would be limited to the outstanding principal balance and any accrued and unpaid interest, we do not expect that fluctuations in interest rates, and the resulting change in fair value of our fixed rate instruments, would have a significant impact on our operations.

Conversely, movements in interest rates on our variable rate debt would change our future earnings and cash flows, but not significantly affect the fair value of those instruments. However, changes in required risk premiums would result in changes in the fair value of floating rate instruments. At December 31, 2014, the fair value of our variable rate debt was $609,929,868 and the carrying value of our fixed rate debt was $603,666,036. At December 31, 2014, we were exposed to market risks related to fluctuations in interest rates on $603,666,036 of our outstanding variable rate debt. Based on interest rates as of December 31, 2014, if interest rates are 100 basis points higher during the 12 months ending December 31, 2015, interest expense on our variable rate debt would increase by $5,945,274 and if interest rates are 100 basis points lower during the 12 months ending December 31, 2015, interest expense on our variable rate debt would decrease by $1,017,140.

At December 31, 2014, the weighted-average interest rate of our fixed rate debt and variable rate debt was 4.30% and 2.51%, respectively. The weighted-average interest rate of our blended fixed and variable rates was 3.36% at December 31, 2014. The weighted-average interest rate represents the actual interest rate in effect at December 31, 2014 (consisting of the contractual interest rate), using interest rate indices as of December 31, 2014, where applicable.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Our consolidated financial statements and supplementary data can be found beginning at page F-1 of this annual report.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

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ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this annual report, management, including our chief executive officer and principal financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and Rule 15d-15(e)). Based upon, and as of the date of, the evaluation, our chief executive officer and principal financial officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this annual report to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file and submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and our chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act.

In connection with the preparation of this annual report, our management, including our chief executive officer and chief accounting officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2014. In making that assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (1992 framework).

Based on its assessment, our management believes that, as of December 31, 2014, our internal control over financial reporting was effective based on those criteria.

There have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Our directors and executive officers and their respective positions and offices are as follows:

Name	Age	Position
Rodney F. Emery	64	Chairman of the Board and Chief Executive Officer
Ella S. Neyland	60	Affiliated Director and President
Kevin J. Keating	52	Treasurer
Ana Marie del Rio	60	Secretary
James A. Shepherdson	62	Affiliated Director
Scot B. Barker	66	Independent Director
Larry H. Dale	69	Independent Director
Kerry D. Vandell	68	Independent Director
Ned W. Brines	53	Independent Director

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Rodney F. Emery serves as our Chairman of the Board and Chief Executive Officer, positions he has held since our inception in May 2009. Mr. Emery also serves as Chairman of the Board and Chief Executive Officer of Steadfast Apartment REIT, Inc., positions he has held since August 2013 and September 2013, respectively. Mr. Emery is the founder of Steadfast Companies and is responsible for the corporate vision, strategy and overall guidance of the operations of Steadfast Companies. Mr. Emery chairs the Steadfast Executive Committee, which establishes policy and strategy and acts as the general oversight committee of Steadfast Companies. Mr. Emery also serves on the Steadfast Companies Investment Committee and is a member of the Board of Managers of Steadfast Capital Markets Group, LLC. Prior to founding Steadfast Companies in 1994, Mr. Emery served for 17 years as the President of Cove Properties, a diversified commercial real estate firm specializing in property-management, construction and development with a specialty in industrial properties. Mr. Emery received a Bachelor of Science in Accounting from the University of Southern California and serves on the board of directors of several non-profit organizations.

Our board of directors, excluding Mr. Emery, has determined that the leadership positions previously and currently held by Mr. Emery and Mr. Emery’s extensive experience acquiring, financing, developing and managing hotel, multifamily, office, and retail real estate assets throughout the country have provided Mr. Emery with the experience, skills and attributes necessary to effectively carry out his duties and responsibilities as a director. Consequently, our board of directors has determined that Mr. Emery is highly qualified to serve as one of our directors.

Ella S. Neyland, serves as our President and an affiliated director, positions she has held since October 2012. Ms. Neyland has also served as one of our independent directors, a position she held from October 2011 to September 2012. Ms. Neyland also serves as President and an affiliated director of Steadfast Apartment REIT, Inc., positions she has held since September 2013 and August 2013, respectively. Ms. Neyland was a founder of Thin Centers MD, or TCMD, which provides medically supervised weight loss programs, and served as its Chief Financial Officer from February 2011 to October 2011. Prior to founding TCMD in June 2010, Ms. Neyland was a founder of Santa Barbara Medical Innovations, LLC, a privately owned company that owns and leases low-level lasers to medical groups, and served as its Chief Financial Officer from December 2008 to February 2011. From October 2004 to December 2008, Ms. Neyland was a financial advisor and an owner of Montecito Medical Investment Company, a private real estate acquisition and development company headquartered in Santa Barbara, California. While with Montecito Medical Investment Company, Ms. Neyland advised the company in the acquisition of 43 medical properties with over two million square feet of space in 13 states and advised the affiliate company, Montecito Property Company, in the acquisition of 8,300 apartments in 29 communities. From April 2001 to September 2004, Ms. Neyland served as the Executive Vice President, Treasurer and Investor Relations Officer of United Dominion Realty Trust,

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Inc., where she was responsible for capital market transactions, banking relationships and presentations to investors and Wall Street analysts. Ms. Neyland also served as a voting member of the Investment Committee of United Dominion Realty Trust, Inc. that approved the repositioning of over $3 billion of investments. Prior to working at United Dominion Realty Trust, Inc., Ms. Neyland served as the Chief Financial Officer at Sunrise Housing, Ltd, a privately owned apartment development company, from November 1999 to March 2001. Ms. Neyland also served as Executive Director of CIBC World Markets, which provides investment, research and corporate banking products, from November 1997 to October 1999. From July 1990 to October 1997, Ms. Neyland served as the Senior Vice President of Finance and the Vice President of Troubled Debt Restructures/Finance for the Lincoln Property Company, a commercial real estate development and management company. From November 1989 to July 1990, Ms. Neyland was the Vice President/Portfolio Manager at Bonnet Resources Corporation, a subsidiary of BancOne. Prior to her employment at Bonnet Resources Corporation, Ms. Neyland served on the board of directors and as the Senior Vice President/Director of Commercial Real Estate Lending at Commerce Savings Association, a subsidiary of the publicly held American Century Corporation, from May 1983 to March 1989. Ms. Neyland received a Bachelor of Science in Finance from Trinity University in San Antonio, Texas.

Our board of directors, excluding Ms. Neyland, has determined that Ms. Neyland’s prior service as a director and as chief financial officer have provided Ms. Neyland with the experience, skills and attributes necessary to effectively carry out her duties and responsibilities as a director. Consequently, our board of directors has determined that Ms. Neyland is highly qualified to serve as one of our directors.

Kevin J. Keating serves as our Treasurer, a position he has held since April 2011. Mr. Keating has also served as Treasurer of Steadfast Apartment REIT since September 2013. In addition, Mr. Keating has served as the Chief Accounting Officer for our advisor and Treasurer of Steadfast Apartment Advisor, LLC since April 2011 and September 2013, respectively, where he focuses on the accounting function and compliance responsibilities for us and our advisor. Mr. Keating served as our controller from January 2011 to March 2011. Prior to joining us and our advisor, Mr. Keating served as Senior Audit Manager with BDO USA, LLP (formerly BDO Seidman, LLP), an accounting and audit firm, from June 2006 to January 2011. From June 2004 to June 2006, Mr. Keating served as Vice President and Corporate Controller of Endocare, Inc., a medical device manufacturer. Mr. Keating has extensive experience working with public companies and served as Assistant Controller and Audit Manager for Ernst & Young LLP from 1988 to 1999. Mr. Keating holds a Bachelor of Science, Accounting from St. John’s University in New York, New York and is a certified public accountant.

Ana Marie del Rio serves as our Secretary and Compliance Officer, positions she has held since our inception in May 2009. Ms. del Rio has also served as Secretary of Steadfast Apartment REIT since September 2013. Ms. del Rio also serves as the Chief Operating Officer for Steadfast Companies. Ms. del Rio manages the Human Resources, Information Technology and Legal Services Departments for Steadfast Companies and is responsible for risk management and company-wide communications. She also works closely with Steadfast Management Company, Inc. in the management and operation of Steadfast Companies’ residential apartment homes. Prior to joining Steadfast Companies in April 2003, Ms. del Rio was a partner in the public finance group at Orrick, Herrington & Sutcliffe, LLP, where she practiced from September 1993 to April 2003, representing both issuers and underwriters in financing single-family and multifamily housing, and other types of public-private and redevelopment projects. From 1979 to 1993, Ms. del Rio co-owned and operated a campaign consulting and research company specializing in local campaigns and ballot measures. Ms. del Rio received a Juris Doctor from the University of the Pacific, McGeorge School of Law, and received a Master of Public Administration and a Bachelor of Arts from the University of Southern California.

James A. Shepherdson serves as one of our affiliated directors, a position he has held since August 2011. Mr. Shepherdson has served as a member of the Board of Managers of Steadfast Capital Markets Group, LLC since February 2011 and has worked in the investment industry for over 30 years. Mr. Shepherdson also serves as a Manager of Crossroads Capital Advisors, LLC and its parent, Crossroads Capital Multifamily, LLC (formerly Crossroads Capital Group, LLC) since April 2011. Mr. Shepherdson served as President of Retirement Services and Senior Executive Vice-President of AXA Equitable Life Insurance Company, or AXA Equitable, from August 2005 to March 2011. Mr. Shepherdson had overall responsibility for AXA Equitable’s retirement and annuity business, which included wholesale distribution through AXA Distributors, the company Mr. Shepherdson co-founded in 1996. While serving as President and Chief Executive Officer of AXA Equitable from August 2005 to March 2011, Mr. Shepherdson oversaw over $30 billion in sales. From September 2009 to November 2011, Mr. Shepherdson also served as Chairman of AXA Life Europe and Chief Executive Officer of AXA Global Distributors, where he distributed proprietary annuity products through global and national banking institutions throughout Europe.

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Mr. Shepherdson served as President and Chief Executive Officer of John Hancock Funds, a vertically integrated mutual fund company from May 2004 to July 2005. Mr. Shepherdson served as co-Chief Executive Officer of MetLife Investors from April 2000 to June 2002. Mr. Shepherdson received a Master of Business Administration degree, with honors, and a Bachelor of Science in Business Administration from the University of Southern California. Mr. Shepherdson holds FINRA Series 22, 26, 39 and 6 licenses.

Our board of directors, excluding Mr. Shepherdson, has determined that the prior leadership positions which Mr. Shepherdson has held and Mr. Shepherdson’s extensive experience in the investment industry provided Mr. Shepherdson with the experience, skills and attributes necessary to effectively carry out his duties and responsibilities as a director. Consequently, our board of directors has determined that Mr. Shepherdson is highly qualified to serve as one of our directors.

Scot B. Barker serves as one of our independent directors, a position he has held since September 2009. From December 2003 to his retirement in December 2005, Mr. Barker served as President and Chief Operating Officer of GMAC Commercial Holding Corp., or GMACCH, one of the nation’s largest financiers of commercial real estate. Mr. Barker served as President of GMACCH Capital Markets Corp from 1998 to December 2003. During his tenure at GMACCH, Mr. Barker oversaw the firm’s real estate lending and investing activities in North America, Latin America, Asia and Europe. In 1978, Mr. Barker and several associates formed Newman and Associates, Inc., an investment banking firm specializing in financing affordable multifamily housing with tax exempt municipal securities. Mr. Barker served as Vice-President of Newman and Associates, Inc. from 1978 to 1984 and as President from 1984 to 1998, when Newman and Associates was acquired by GMACCH. Prior to founding Newman and Associates, Inc., Mr. Barker served as Vice-President with Gerwin & Co. from 1973 to 1978. Mr. Barker has been involved in a variety of professional and not-for-profit groups primarily focused on housing related business. Mr. Barker currently serves on the board of directors of Mountain Asset Management, a wholly-owned subsidiary of The Great-West Life Assurance Company. Mr. Barker was a past president of the National Housing and Rehabilitation Association and a past member of the Federal National Mortgage Association (Fannie Mae) Housing Impact Advisory Council. Mr. Barker received a Bachelor of Arts from Colorado College and a Master of Business Administration from the University of Denver.

Our board of directors, excluding Mr. Barker, has determined that the prior leadership positions which Mr. Barker has held and Mr. Barker’s extensive experience with the financing of commercial real estate and multifamily housing have provided Mr. Barker with the experience, skills and attributes necessary to effectively carry out his duties and responsibilities as a director. Consequently, our board of directors has determined that Mr. Barker is highly qualified to serve as one of our directors.

Larry H. Dale serves as one of our independent directors, a position he has held since September 2009. In March 2009, Mr. Dale retired as a Managing Director of Citi Community Capital, or CCC, a leading investment banking group specializing in affordable housing financing and a division of Citigroup’s Municipal Securities Division, where Mr. Dale was responsible for the overall management and oversight of the operation of the division. As an employee of CCC, Mr. Dale was involved in lending decisions and equity sales with us. Mr. Dale joined the predecessor company to CCC in 1997. From July 1987 to January 1997, Mr. Dale served as a Senior Vice President of Fannie Mae, leading its apartment financing and affordable housing efforts. Prior to joining Fannie Mae, Mr. Dale served from 1984 to 1987 as Vice President of Newman and Associates, Inc., an investment banking firm focused on financing affordable multifamily housing with tax exempt municipal securities. Prior to joining Newman and Associates, Mr. Dale served from 1981 to 1983 as President of Mid-City Financial Corporation, a regional multifamily development, financing, and management firm. From 1971 to 1981, Mr. Dale was employed by the U.S. Department of Housing and Urban Development (HUD), including service as a Deputy to the Assistant Secretary for Housing/FHA Commissioner from 1979 to 1981. Mr. Dale currently serves as Chairman of the Board of the National Equity Fund, a member of the Board and Chairman of the Finance Committee of Mercy Housing Incorporated’s Board of Trustees, a member of the board of directors and the Executive Committee of the Local Initiative Support Corporation and a member of the Advisory Board of the Paramount Community Development Fund, the Capmark Community Development Fund and the Community Impact NMTC Advisory Board. Mr. Dale received a Bachelor of Science in Materials Science from Cornell University and a Master of Political Science from the Maxwell School at Syracuse University.

Our board of directors, excluding Mr. Dale, has determined that the prior leadership positions which Mr. Dale has held and Mr. Dale’s extensive experience in financing multifamily housing have provided Mr. Dale with the experience, skills and attributes necessary to effectively carry out his duties and responsibilities as a director. Consequently, our board of directors has determined that Mr. Dale is highly qualified to serve as one of our directors.

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Kerry D. Vandell serves as one of our independent directors, a position he has held since October 2012. Dr. Vandell also serves as an independent director of Steadfast Apartment REIT, a position he has held since August 2013. Dr. Vandell currently serves as the Dean’s Professor of Finance and Director of the Center for Real Estate at the Paul Merage School of Business at the University of California-Irvine (UCI), having joined UCI in July 2006. He also has held courtesy appointments at UCI’s School of Law and the Department of Planning, Policy and Design in the School of Social Ecology since 2008. Before joining UCI, Dr. Vandell was on the faculty of the University of Wisconsin-Madison for 17 years (1989-2006), where he served as the Tiefenthaler Chaired Professor of Real Estate and Urban Land Economics, the Director of the Center for Urban Land Economics Research, and the Chairman of the Department of Real Estate and Urban Land Economics. His first academic appointment was at Southern Methodist University (1976-1989), where he ultimately served as Professor and Chairman of the Department of Real Estate and Regional Science. Dr. Vandell has researched and consulted extensively in the areas of real estate investment, urban/real estate/environmental economics, mortgage finance, housing economics and policy, and valuation theory and is principal in the consulting firm KDV Associates, providing expert testimony in major litigation matters internationally. He has also previously served as a board member for firms representing the commercial banking, REIT and shopping center sectors. Dr. Vandell received his Ph.D. from the Massachusetts Institute of Technology in Urban Studies and Planning, his M.C.P. in City and Regional Planning from Harvard University, and his undergraduate and master’s degrees in Mechanical Engineering from Rice University. He has authored or co-authored over 70 publications and has been invited to provide numerous presentations on the topics of finance, economics and real estate.

Our board of directors, excluding Dr. Vandell, has determined that Dr. Vandell’s prior position as a finance professor and his real estate program experience have provided Dr. Vandell with the experience, skills and attributes necessary to effectively carry out his duties and responsibilities as a director. Consequently, our board of directors has determined that Dr. Vandell is highly qualified to serve as one of our directors.

Ned W. Brines serves as one of our independent directors, a position he has held since October 2012. Mr. Brines currently serves as the Chief Investment Officer for the CitizenTrust Wealth Management and Trust division of Citizens Business Bank, a position he has held since July 2012, where Mr. Brines is responsible for the investment management discipline, process, products and related sources. In addition, in September 2008 Mr. Brines founded Montelena Asset Management, a California based registered investment advisor firm, and currently serves as its Chief Investment Officer.  From June 2010 to July 2012, Mr. Brines served as a portfolio manager for Andell Holdings, a private family office with significant and diversified holdings.  From May 2001 to September 2008, Mr. Brines served as a Senior Vice President and senior portfolio manager with Provident Investment Counsel in Pasadena managing their Small Cap Growth Fund with $1.6 billion in assets under management (AUM).  Mr. Brines was with Roger Engemann & Associate in Pasadena from September 1994 to March 2001 in which he served as both an analyst and portfolio manager for their mid cap mutual fund and large cap Private Client business as the firm grew from $3 billion to over $19 billion in AUM.  Mr. Brines earned a Master of Business Administration degree from the University of Southern California and a Bachelor of Science degree from San Diego State University. Mr. Brines also holds the Chartered Financial Analyst (CFA) designation and is involved in various community activities including serving on the investment committee of City of Hope as well as the Orange County Regional Counsel for San Diego State University.

Our board of directors, excluding Mr. Brines, has determined that Mr. Brines prior service as a director and as chief investment officer have provided Mr. Brines with the experience, skills and attributes necessary to effectively carry out his duties and responsibilities as a director. Consequently, our board of directors has determined that Mr. Brines is highly qualified to serve as one of our directors.

The Audit Committee

Our board of directors has established an audit committee. The audit committee’s function is to assist our board of directors in fulfilling its responsibilities by overseeing: (1) the integrity of our financial statements, (2) our compliance with legal and regulatory requirements, (3) our independent auditors’ qualifications and independence, and (4) the performance of the independent auditors and our internal audit function. The members of the audit committee are Scot B. Barker, Larry H. Dale and Kerry Dean Vandell. All of the members of the audit committee are “independent” as defined by our charter. Our shares are not listed for trading on any national securities exchange and therefore our audit committee members are not subject to the independence requirements of the New York Stock Exchange, or “NYSE,” or any other national securities exchange. However, each member of our audit committee is “independent” as defined by the NYSE. All members of the audit committee have

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significant financial and/or accounting experience. Our board of directors has determined that Dr. Vandell satisfies the SEC’s requirements for and serves as our “audit committee financial expert.”

Investment Committee

Our board of directors has delegated to the investment committee: (1) certain responsibilities with respect to investment in specific investments proposed by our advisor and (2) the authority to review our investment policies and procedures on an ongoing basis. The investment committee must at all times be comprised of at least three members and a majority of independent directors. The current members of the investment committee are Rodney F. Emery, Scot B. Barker, Larry H. Dale, Ella S. Neyland and Ned W. Brines, with Mr. Emery serving as the chairman of the investment committee.

With respect to investments, the investment committee has the authority to approve all real property acquisitions, developments and dispositions, including real property portfolio acquisitions, developments and dispositions, as well as all real estate-related investments and all investments consistent with our investment objectives, for a purchase price, total project cost or sales price of up to 10% of the cost of our net assets as of the date of investment.

Valuation Committee

Our board of directors has established a valuation committee. The valuation committee’s function, as recommended by the Investment Program Association (IPA), is to perform the following functions: (1) ratify and approve the engagement of CBRE Capital Advisors, Inc., its scope of work and any amendments thereto, (2) review and approve the proposed valuation process and methodology to be used to determine a valuation, (3) review the reasonableness of the valuation or range of value resulting from the process and (4) recommend the final proposed valuation for approval by the board of directors. The members of the valuation committee are Scot B. Barker, Ned W. Brines, Larry H. Dale and Kerry D. Vandell, with Mr. Brines serving as the chairman of the valuation committee.

Special Committee

Our board of directors has established a special committee. The special committee’s function is limited to the evaluation, negotiation and approval of (1) any agreement, arrangement or other transaction by and between our company, our advisor or any other affiliate of our sponsor related to compensation payable by our company to our advisor any other affiliate of our sponsor in connection with the pursuit of strategic alternatives; (2) any strategic alternatives in which a counter party has expressed an interest in the contemporaneous or subsequent purchase of any other transaction related to Steadfast Companies; and (3) any other transaction which the board specifically identifies and delegates authority to the special committee. The members of the special committee are Scot B. Barker, Ned W. Brines, Larry H. Dale and Kerry D. Vandell, with Mr. Barker serving as the chairman of the special committee.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires each director, officer and individual beneficially owning more than 10% of our common stock to file with the SEC, within specified time frames, initial statements of beneficial ownership (Form 3) of our common stock and statements of changes in beneficial ownership (Forms 4 and 5) of our common stock. These specified time frames require the reporting of changes in ownership within two business days of the transaction giving rise to the reporting obligation. Reporting persons are required to furnish us with copies of all Section 16(a) forms filed with the SEC. Based solely on a review of the copies of such forms furnished to us during and with respect to the fiscal year ended December 31, 2014, or written representations that no additional forms were required, we believe that all required Section 16(a) filings were timely and correctly made by reporting persons during 2014.

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Code of Conduct and Ethics

We have adopted a Code of Ethics that applies to all of our executive officers and directors, including but not limited to, our principal executive officer, principal financial officer and principal accounting officer. Our Code of Ethics can be found at our website: http://www.steadfastreits.com.

ITEM 11. EXECUTIVE COMPENSATION

Compensation of Executive Officers

Our executive officers do not receive compensation directly from us for services rendered to us and we do not intend to pay any compensation to our executive officers. We do not reimburse our advisor directly or indirectly for the salary or other compensation paid to any of our executive officers. As a result, we do not, nor has our board of directors considered, a compensation policy for our executive officers and we have not included a Compensation and Discussion Analysis in this annual report. Our executive officers are officers and/or employees of, or hold an indirect ownership interest in our advisor, and/or its affiliates, and our executive officers are compensated by these entities, in part, for their services to us. See Item 13. “Certain Relationships and Related Transactions, and Director Independence—Certain Transactions with Related Persons” for a discussion of the fees paid to our advisor and its affiliates.

Compensation of Directors

If a director is also one of our executive officers or an affiliate of our advisor, we do not pay any compensation to that person for services rendered as a director. The amount and form of compensation payable to our independent directors for their service to us is determined by our board of directors, based upon recommendations from our advisor. Four of our executive officers, Messrs. Rodney F. Emery and Kevin Keating and Mses. Ana Marie del Rio and Ella Neyland, manage, control or are affiliated with our advisor, and through our advisor, they are involved in recommending the compensation to be paid to our independent directors.

We have provided below certain information regarding compensation earned by or paid to our directors during fiscal year December 31, 2014.

Name	Fees Earned or Paid in Cash in 2014		All Other Compensation(1)		Total
Scot B. Barker(2)	$	107,000	$	25,600	$	132,600
Larry H. Dale(2)	104,000		25,600		129,600
Kerry D. Vandell(2)	112,000		25,600		137,600
Ned W. Brines(2)	108,000		25,600		133,600
James A. Shepherdson(3)	—		—		—
Ella S. Neyland(3)	—		—		—
Rodney F. Emery(3)	—		—		—

________________

(1) The amounts shown in this column reflect the aggregate fair value of shares of restricted stock granted under our independent directors’ compensation plan computed as of the grant date in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718.

(2) Independent Directors.

(3) Directors who are also our executive officers or executive officers of our affiliates do not receive compensation for services rendered as a director.

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Cash Compensation

We pay each of our independent directors:

• an annual retainer of $65,000 (the audit committee chairperson receives an initial $10,000 annual retainer);

• $3,000 for each in-person board of directors meeting attended;

• $2,000 for each in-person committee meeting attended; and

• $1,000 for each teleconference meeting of the board of directors or committee.

Equity Plan Compensation

We have approved and adopted an independent directors’ compensation plan, which operates as a sub-plan of our long-term incentive plan. Under the independent directors’ compensation plan and subject to such plan’s conditions and restrictions, each of our current independent directors was entitled to receive 5,000 shares of restricted common stock in connection with the initial meeting of the full board of directors. Our initial board of directors, and each of the independent directors, agreed to delay the initial grant of restricted stock until we raised $2,000,000 in gross offering proceeds. Going forward, each new independent director that joins our board of directors receives 5,000 shares of restricted common stock upon election to our board of directors. In addition, on the date following an independent director’s re-election to our board of directors, he or she receives 2,500 shares of restricted common stock. The shares of restricted common stock granted pursuant to our independent directors’ compensation plan generally vest in four equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant; provided, however, that the restricted stock will become fully vested on the earlier to occur of: (1) the termination of the independent director’s service as a director due to his or her death or disability, or (2) our change in control.

Compensation Committee Interlocks and Insider Participation

We currently do not have a compensation committee of our board of directors because we do not pay, or plan to pay, any compensation to our officers. There are no interlocks or insider participation as to compensation decisions required to be disclosed pursuant to SEC regulations.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Equity Compensation Plan Information

The following table provides information about our common stock that may be issued upon the exercise of options, warrants and rights under our incentive award plan as of December 31, 2014.

Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights	Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights	Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans
Equity compensation plans approved by security holders:	—	—	939,375
Equity compensation plans not approved by security holders:	N/A	N/A	N/A
Total	—	—	939,375

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Security Ownership of Certain Beneficial Owners

The following table shows, as of March 10, 2015, the amount of our common stock beneficially owned (unless otherwise indicated) by: (1) any person who is known by us to be the beneficial owner of more than 5% of the outstanding shares of our common stock, (2) our directors, (3) our executive officers, and (4) all of our directors and executive officers as a group.

Name and Address of Beneficial Owner(1)	Amount and Nature of Beneficial Ownership(2)	Percentage
Rodney F. Emery(3)	510,504	*
Scot B. Barker	32,052	*
Larry H. Dale	18,000	*
Kerry D. Vandell	11,108	*
Ned Brines	19,956	*
Ella S. Neyland	9,900	*
James A. Shepherdson	—	*
Kevin J. Keating	4,706	*
Ana Marie del Rio	5,496	*
All officers and directors as a group	611,722	*

________________

* Less than 1% of the outstanding common stock.

(1) The address of each named beneficial owner is c/o Steadfast Income REIT, Inc., 18100 Von Karman Avenue, Suite 500, Irvine, CA, 92612.

(2) None of the shares are pledged as security.

(3) Consists of 22,223 shares owned by Steadfast REIT Investments, LLC, and 488,281 restricted shares owned by Steadfast Income Advisor, LLC, which are each primarily indirectly owned and controlled by Rodney F. Emery.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Certain Transactions with Related Persons

The following describes all transactions during the year ended December 31, 2014 involving us, our directors, our advisor, our sponsor and any affiliate thereof and all such proposed transactions. See also Note 8 (Related Party Arrangements) to the consolidated financial statements included in this annual report. Our independent directors are specifically charged with and have examined the fairness of such transactions to our stockholders, and have determined that all such transactions are fair and reasonable to us.

Ownership Interests

On June 12, 2009, our sponsor, Steadfast REIT Investments, LLC, purchased 22,223 shares of our common stock for an aggregate purchase price of $200,007 and was admitted as our initial stockholder. Our sponsor is majority owned and controlled indirectly by Rodney F. Emery, our chairman and chief executive officer. On July 10, 2009, our advisor purchased 1,000 shares of our convertible stock for an aggregate purchase price of $1,000. As of December 31, 2014 and 2013, our advisor owned 100% of our outstanding convertible stock. We are the general partner of our operating partnership and our advisor has made a $1,000 capital contribution to our operating partnership as the initial limited partner.

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Our convertible stock will convert into shares of our common stock if and when: (A) we have made total distributions on the then outstanding shares of our common stock equal to the original issue price of those shares plus an aggregate 8.0% cumulative, non-compounded, annual return on the original issue price of those shares, (B) we list our common stock for trading on a national securities exchange or (C) our advisory agreement is terminated or not renewed (other than for “cause” as defined in our advisory agreement). In the event of a termination or non-renewal of our advisory agreement for cause, the convertible stock will be redeemed by us for $1.00. In general, each share of our convertible stock will convert into a number of shares of common stock equal to 1/1000 of the quotient of: (A) 10% of the excess of (1) our “enterprise value” (as defined in our charter) plus the aggregate value of distributions paid to date on the then outstanding shares of our common stock over (2) the aggregate purchase price paid by stockholders for those outstanding shares of common stock plus an 8.0% cumulative, non-compounded, annual return on the original issue price of those outstanding shares, divided by (B) our enterprise value divided by the number of outstanding shares of common stock on an as-converted basis, in each case calculated as of the date of the conversion. Shares of our convertible stock are not paid dividends and as of December 31, 2014 all shares of convertible stock remained outstanding.

Our Relationships with our Advisor and our Sponsor

Steadfast Income Advisor, LLC is our advisor and, as such, supervises and manages our day-to-day operations and selects our real property investments and real estate-related assets, subject to oversight by our board of directors. Our advisor also provides marketing, sales and client services on our behalf. Our advisor is owned by our sponsor. Mr. Emery, our chairman of the board and chief executive officer, indirectly controls our sponsor, our advisor and our dealer manager. Ms. Ana Marie del Rio, our Secretary, owns an indirect 7% interest in our sponsor and advisor. Crossroads Capital Multifamily, LLC, or Crossroads Capital Multifamily, currently owns a 25% membership interest in our sponsor that will increase upon a net increase in our book capitalization. Pursuant to the Second Amended and Restated Operating Agreement of our sponsor, effective as of May 31, 2011, all distributions to Crossroads Capital Multifamily are subordinated to distributions to the other member of our sponsor, Steadfast REIT Holdings, LLC, or Steadfast Holdings, until Steadfast Holdings has received an amount equal to certain expenses, including certain organization and offering costs, incurred by Steadfast Holdings and its affiliates on our behalf. Mr. Shepherdson, an affiliated director, serves as a Manager of Crossroads Capital Advisors, LLC, a subsidiary of Crossroads Capital Multifamily, which we refer to as “Crossroads Capital Advisors.”

All of our other officers and directors, other than our independent directors, are officers of our advisor and officers, limited partners and/or members of our sponsor and other affiliates of our advisor.

We and our operating partnership have entered into the advisory agreement with our advisor and our operating partnership which has a one-year term expiring May 3, 2015, subject to an unlimited number of successive one-year renewals upon mutual consent of the parties. We may terminate the advisory agreement without cause or penalty upon 60 days written notice and immediately upon fraud, criminal conduct, willful misconduct, gross negligence or material breach of the advisory agreement by our advisor or our advisor’s bankruptcy. If we terminate the advisory agreement, we will pay our advisor all unpaid advances for operating expenses and all earned but unpaid fees.

Services provided by our advisor under the terms of the advisory agreement include the following:

• finding, presenting and recommending investment opportunities to us consistent with our investment policies and objectives;

• making investment decisions for us, subject to the limitations in our charter and the direction and oversight of our board of directors;

• structuring the terms and conditions of our investments, sales and joint ventures;

• acquiring investments on our behalf in compliance with our investment objectives and policies;

• sourcing and structuring our loan originations;

• arranging for financing and refinancing of investments;

• entering into service agreements for our loans;

• supervising and evaluating each loan servicer’s and property manager’s performance;

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• reviewing and analyzing the operating and capital budgets of the properties underlying our investments and the properties we may acquire;

• entering into leases and service contracts for our properties;

• assisting us in obtaining insurance;

• generating our annual budget;

• reviewing and analyzing financial information for each of our assets and our overall investment portfolio;

• formulating and overseeing the implementation of strategies for the administration, promotion, management, financing and refinancing, marketing, servicing and disposition of our investments;

• performing investor relations services;

• maintaining our accounting and other records and assisting us in filing all reports required to be filed with the SEC, the Internal Revenue Service and other regulatory agencies;

• engaging and supervising the performance of our agents, including our registrar and transfer agent; and

• performing any other services reasonably requested by us.

The above summary is provided to illustrate the material functions that our advisor performs for us as an advisor and is not intended to include all of the services that may be provided to us by our advisor, its affiliates or third parties. The advisor has also entered into a Services Agreement with Crossroads Capital Advisors whereby Crossroads Capital Advisors provides advisory services to us on behalf of our advisor.

Fees and Expense Reimbursements Paid to our Advisor

Pursuant to the terms of our advisory agreement, we pay our advisor the fees described below.

• We pay our advisor an acquisition fee of 2.0% of: (1) the total cost of investment, as defined in connection with the acquisition or origination of any type of real property or real estate-related asset, or (2) our allocable cost of a real property or real estate-related asset acquired in a joint venture, in each case including purchase price, acquisition expenses and any debt attributable to such investments. For the year ended December 31, 2014, we incurred acquisition fees of $3,251,400 in connection with the acquisition of seven multifamily properties. During the same period, we paid $3,296,422 in acquisition fees.

• We pay our advisor an annual investment management fee that is payable monthly in an amount equal to one-twelfth of 0.8% of the cost of all assets we own and of our investments in joint ventures, including acquisition fees, origination fees, acquisition and origination expenses and any debt attributable to such investments. For the year ended December 31, 2014, we incurred investment management fees to our advisor of $13,252,309. During the same period, we paid $16,627,339.

• We pay our advisor a disposition fee of 1.5% of the contract sales price of each property sold if our advisor or its affiliates provides a substantial amount of services, as determined by our independent directors, in connection with the sale of a real property or real estate-related asset. However, our charter limits the maximum amount of disposition fees payable to our advisor for the sale of any real property to the lesser of one-half of the brokerage commission paid or 3% of the contract sales price, but in no event shall the total real estate commissions paid, including any disposition fees payable to our advisor, exceed 6% of the contract sales price. With respect to a property held in a joint venture, the foregoing commission will be reduced to a percentage of such amounts reflecting our economic interest in the joint venture. For the year ended December 31, 2014, we incurred disposition fees of $463,688 in connection with the disposition of three multifamily properties. During the same period, we paid $463,688 in disposition fees.

In addition to the fees we pay to our advisor pursuant to the advisory agreement, we also reimburse our advisor and its affiliates for the costs and expenses described below.

• We reimburse our advisor and its affiliates for organization and offering expenses, for actual legal, accounting, printing mailing and filing fees, charges of our transfer agent, expenses of organizing the company, data processing fees,

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advertising and sales literature costs, information technology costs, bona fide out of-of-pocket due diligence costs, and other costs in connection with preparing supplemental sales materials and providing other administrative services in connection with our offerings. Any such reimbursement will not exceed actual expenses incurred by our advisor. After the termination of the initial public offering, our advisor has agreed to reimburse us to the extent selling commissions, dealer manager fees and organization and offering expenses borne by us exceed 15% of the gross proceeds raised in our completed public offering. For the year ended December 31, 2014, we paid our advisor $3,105,246 for the reimbursement of organization and offering expenses. At the termination of our initial public offering, selling commissions, dealer manager fees and organization and other offering costs did not exceed the 15% limitation.

• Subject to the 2%/25% Guideline discussed below, we reimburse our advisor for the cost of administrative services, including personnel costs and our allocable share of other overhead of the advisor such as rent and utilities; provided, however, that no reimbursement shall be made for costs of such personnel to the extent that personnel are used in transactions for which our advisor receives an acquisition fee, investment management fee or disposition fee or for the employee costs our advisor pays to our executive officers. For the year ended December 31, 2014, $915,618 was paid to our advisor for administrative services.

• We reimburse our advisor for acquisition expenses incurred related to the selection and acquisition of real property investments and real estate-related investments. For the year ended December 31, 2014, we reimbursed our advisor $583,511 for acquisition expenses.

2%/25% Guidelines

As described above, our advisor and its affiliates are entitled to reimbursement of actual expenses incurred for administrative and other services provided to us for which they do not otherwise receive a fee. However, we will not reimburse our advisor or its affiliates at the end of any fiscal quarter for “total operating expenses” that for the four consecutive fiscal quarters then ended, or the expense year, exceeded the greater of (1) 2% of our average invested assets or (2) 25% of our net income, which we refer to as the “2%/25% Guidelines,” and our advisor must reimburse us quarterly for any amounts by which our total operating expenses exceed the 2%/25% Guidelines in the expense year, unless our independent directors have determined that such excess expenses were justified based on unusual and non-recurring factors.

For purposes of the 2%/25% Guidelines, “total operating expenses” means all costs and expenses paid or incurred by us, as determined under GAAP, that are in any way related to our operation or to corporate business, including advisory fees, but excluding (1) the expenses of raising capital such as organization and offering expenses, legal, audit, accounting, underwriting, brokerage, listing, registration, and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, registration and the listing of our shares of common stock, (2) interest payments, (3) taxes, (4) non-cash expenditures such as depreciation, amortization and bad debt reserves, (5) incentive fees, (6) acquisition fees and acquisition expenses, (7) real estate commissions on the sale of a real property, and (8) other fees and expenses connected with the acquisition, disposition, management and ownership of real estate interests, mortgage loans or other property (including the costs of foreclosure, insurance premiums, legal services, maintenance, repair, and improvement of property).

Fees and Reimbursements Paid to Our Property Manager

• We have entered into property management agreements with Steadfast Management Company, Inc., or the property manager, an affiliate of our sponsor, with respect to the management of 62 of our multifamily properties. Pursuant to the management agreements, we pay the property manager a monthly management fee equal to a certain percentage of each property’s gross revenues (as defined in the respective management agreements) for each month. Each management agreement has an initial one year term and will continue thereafter on a month-to-month basis unless either party gives prior 60 day notice of its desire to terminate the management agreement, provided that we may terminate the management agreement upon an uncured breach of the agreement upon 30 days prior written notice to the property manager. For the year ended December 31, 2014, we paid property management fees of $5,717,813 to our property manager.

• The property management agreements specify that we are to reimburse the property manager for the salaries and related benefits of on-site personnel. For the year ended December 31, 2014, we reimbursed on-site personnel costs of $17,827,185 to our property manager.

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• The property management agreements also specify certain other fees payable to the property manager for benefit administration, information technology infrastructure, licenses, and support, and training services. For the year ended December 31, 2014, we paid other fees of $1,585,747 to our property manager.

Construction Management Fees Paid to Our Construction Manager

We have entered into construction management agreements with Pacific Coast Land and Construction, Inc., or the construction manager, an affiliate of our sponsor, in connection with the planned renovation for certain of our properties. The construction management fee payable with respect to each property under the construction management agreements ranges from 8.0% to 12.0% of the costs of the improvements for which the construction manager has oversight authority. Generally, each construction management agreement has a term equal to the planned renovation timeline unless either party gives 30 days prior notice of its desire to terminate the construction management agreement. For the year ended December 31, 2014, we have paid construction management fees of $1,348,151 to our construction manager.

Stock Purchase Plan

On November 15, 2012, we entered into a Stock Purchase Plan, or the plan, with Ella S. Neyland, our President and a member of our board of directors, whereby Ms. Neyland agreed to invest $5,530 for 600 shares of our common stock pursuant to our public offering on the first day of each fiscal quarter. The plan terminated on November 15, 2013. As of December 31, 2013, Ms. Neyland purchased 2,400 shares for $22,118 pursuant to the plan.

Restricted Stock Agreement

On June 11, 2014, we entered into a restricted stock agreement with our advisor whereby we issued to the advisor 488,281.25 restricted shares of our common stock at a fair market value of $10.24 per share in satisfaction of certain deferred fees due to the advisor in the aggregate amount of $5,000,000. The shares of restricted stock vest and become non-forfeitable upon the earliest to occur of (i) 50% at December 31, 2015 and 50% at December 31, 2016, (ii) certain liquidity events of us, (iii) our cumulative modified funds from operations exceed the lesser of (a) the cumulative amount of distributions paid to our stockholders or (b) an amount that is equal to a 7.0% cumulative, non-compounded annual return on our stockholders’ invested capital, or (iv) our termination of, or failure to renew, the advisory agreement other than for “cause” (as defined in the advisory agreement). The shares of restricted stock shall be forfeited if the advisor is terminated for any reason other than (iv) above.

Currently Proposed Transactions

Other than as described above, there are no currently proposed material transactions with related persons other than those covered by the terms of the agreements described above.

Policies and Procedures for Transactions with Related Persons

In order to reduce or eliminate certain potential conflicts of interest, our charter and our advisory agreement contain restrictions and conflict resolution procedures relating to transactions we enter into with our advisor, our directors or their respective affiliates. Each of the restrictions and procedures that apply to transactions with our advisor and its affiliates will also apply to any transaction with any entity or real estate program controlled by our advisor and its affiliates. As a general rule, any related party transaction must be approved by a majority of the directors (including a majority of independent directors) not otherwise interested in the transaction. In determining whether to approve or authorize a particular related party transaction, these persons will consider whether the transaction between us and the related party is fair and reasonable to us and has terms and conditions no less favorable to us than those available from unaffiliated third parties.

We have also adopted a Code of Ethics that applies to each of our officers and directors, which we refer to as “covered persons.” The Code of Ethics sets forth certain conflicts of interest policies that limit and govern certain matters among us, the covered persons, our advisor and their respective affiliates.

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Director Independence

Although our shares are not listed for trading on any national securities exchange, a majority of the members of our board of directors and all of the members of the audit committee are “independent” as defined by the NYSE. The NYSE standards provide that to qualify as an independent director, in addition to satisfying certain bright-line criteria, the board of directors must affirmatively determine that a director has no material relationship with us (either directly or as a partner, stockholder or officer of an organization that has a relationship with us). In addition, we have determined that these directors are independent pursuant to the definition of independence in our charter, which is based on the definition included in the North American Securities Administrators Association, Inc.’s Statement of Policy Regarding Real Estate Investment Trusts, as revised and adopted on May 7, 2007. Our board of directors has determined that Scot B. Barker, Larry H. Dale, Kerry D. Vandell and Ned W. Brines each satisfies the bright-line criteria and that none has a relationship with us that would interfere with such person’s ability to exercise independent judgment as a member of our board of directors. None of these directors has ever served as (or is related to) an employee of ours or any of our predecessors or acquired companies or received any compensation from us or any such other entities except for compensation directly related to service as a director. Therefore, we believe that all of these directors are independent directors.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Independent Registered Public Accounting Firm

During the years ended December 31, 2014 and 2013, Ernst & Young LLP, or Ernst & Young, served as our independent registered public accounting firm and provided us with certain tax and other services. Ernst & Young has served as our independent auditor since our formation.

Pre-Approval Policies

The audit committee charter imposes a duty on our audit committee to pre-approve all auditing services performed for us by our independent auditors as well as all permitted non-audit services in order to ensure that the provision of such services does not impair the auditors’ independence. In determining whether or not to pre-approve services, our audit committee will consider whether the service is a permissible service under the rules and regulations promulgated by the SEC. Our audit committee, may, in its discretion, delegate to one or more of its members the authority to pre-approve any audit or non-audit services to be performed by the independent auditors, provided any such approval is presented to and approved by the full audit committee at its next scheduled meeting.

All services rendered by Ernst & Young for the years ended December 31, 2014 and 2013 were pre-approved in accordance with the policies and procedures described above.

Principal Independent Registered Public Accounting Firm Fees

Our audit committee reviewed the audit and non-audit services performed by Ernst & Young, as well as the fees charged by Ernst & Young for such services. In its review of the non-audit service fees, our audit committee considered whether the provision of such services is compatible with maintaining the independence of Ernst & Young. The aggregate fees billed to us for professional accounting services, including the audit of our annual financial statements by Ernst & Young for the years ended December 31, 2014 and 2013, are set forth in the table below.

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	2014		2013
Audit fees	$	527,885	$	796,155
Audit-related fees	13,750		70,750
Tax fees	128,350		60,000
All other fees	998		1,995
Total	$	670,983	$	928,900

For purposes of the preceding table, Ernst & Young’s professional fees are classified as follows:

• Audit fees - These are fees for professional services performed for the audit of our annual financial statements and the required review of quarterly financial statements and other procedures performed by Ernst & Young in order for them to be able to form an opinion on our consolidated financial statements. These fees also cover services that are normally provided by independent auditors in connection with statutory and regulatory filings or engagements.

• Audit-related fees - These are fees for assurance and related services that traditionally are performed by independent auditors that are reasonably related to the performance of the audit or review of the financial statements, such as due diligence related to acquisitions and dispositions, attestation services that are not required by statute or regulation, internal control reviews and consultation concerning financial accounting and reporting standards.

• Tax fees - These are fees for all professional services performed by professional staff in our independent auditor’s tax division, except those services related to the audit of our financial statements. These include fees for tax compliance, tax planning and tax advice, including federal, state and local issues. Services may also include assistance with tax audits and appeals before the Internal Revenue Service and similar state and local agencies, as well as federal, state and local tax issues related to due diligence.

• All other fees - These are fees for any services not included in the above-described categories.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

a. Financial Statement Schedules

See the Index to Financial Statements at page F-1 of this report.

The following financial statement schedule is included herein at page F-47 of this report:

Schedule III - Real Estate Assets and Accumulated Depreciation and Amortization

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b. Exhibits

EXHIBIT LIST

Exhibit	Description
3.1	Third Articles of Amendment and Restatement of Steadfast Income REIT, Inc. (incorporated by reference to Exhibit 3.1 to Registrant’s Form 8-K filed August 6, 2014)
3.2	Bylaws of Steadfast Income REIT, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form S-11, filed July 23, 2009, Commission File No. 333-160748)
4.1	Form of Subscription Agreement (incorporated by reference to Appendix B to the prospectus, dated July 9, 2010 of the Registrant)
4.2	Form of Distribution Reinvestment Plan (incorporated by reference to Appendix C to the prospectus, dated July 9, 2010, of the Registrant)
10.1	Amended and Restated Advisory Agreement, dated as of May 4, 2010, by and among Steadfast Income REIT, Inc., Steadfast Secure Income REIT Operating Partnership, L.P. and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.1 to Pre- Effective Amendment No. 4)
10.2	Limited Partnership Agreement of Steadfast Income REIT Operating Partnership, L.P. (incorporated by reference to Exhibit 10.3 to Pre-Effective Amendment No. 1 to the Registrant’s Registration Statement on Form S-11, filed October 15, 2009, Commission File No. 333-160748 (“Pre-Effective Amendment No. 1”))
10.3	Steadfast Income REIT, Inc. 2009 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.4 to Pre-Effective Amendment No. 1)
10.4	Steadfast Income REIT, Inc. Independent Directors Compensation Plan (incorporated by reference to Exhibit 10.5 to Pre-Effective Amendment No. 1)
10.5	Form of Restricted Stock Award Certificate (incorporated by reference to Exhibit 10.6 to Pre-Effective Amendment No. 4)
10.6	Property Management Agreement, dated as of January 26, 2012, by and between SIR Windsor On The River, LLC and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed February 1, 2012)
10.7	Assumption Agreement, dated as of January 26, 2012, by and among Windsor on the River, LLC, SIR Windsor On The River, LLC and The Bank Of New York Mellon Trust Company, N.A. (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed February 1, 2012)
10.8	Loan Agreement, dated as of May 1, 2007, by and between Iowa Finance Authority and Windsor On The River, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed February 1, 2012)
10.9	Promissory Note (Series 2007A), dated as of February 1, 2008, by Windsor On The River, LLC in favor of The Bank Of New York Mellon Trust Company, N.A. (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed February 1, 2012)
10.10	Reimbursement and Credit Agreement, dated as of January 26, 2012, by and between SIR Windsor on the River, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed February 1, 2012)
10.11	Mortgage with Absolute Assignment of Leases and Rents, Security Agreement and Fixture filing, dated as of January 26, 2012, by SIR Windsor on the River, LLC in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed February 1, 2012)
10.12	Pledge and Security Agreement, dated as of January 26, 2012, by and among SIR Windsor on the River, LLC, The Bank Of New York Trust Company, N.A. and PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed February 1, 2012)
10.13	Guaranty Agreement, dated as of January 26, 2012, by Steadfast Income REIT, Inc. in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed February 1, 2012)
10.14	Hazardous Materials Indemnity Agreement, dated as of January 26, 2012, by SIR Windsor on the River, LLC and Steadfast Income REIT, Inc. in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed February 1, 2012)

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10.15	Land Use Restriction Agreement, dated as of November 1, 2007, by and between Iowa Finance Authority, Windsor On The River, LLC and The Bank Of New York Trust Company, N.A. (incorporated by reference to Exhibit 10.10 to the Registrant’s Form 8-K filed February 1, 2012)
10.16	Remarketing Agreement, dated as of May 1, 2007, between Stern Brothers & Co. and Windsor on the River, LLC (incorporated by reference to Exhibit 10.11 to the Registrant’s Form 8-K filed February 1, 2012)
10.17	Purchase Contract (Renaissance at St. Andrews Apartments), dated as of December 30, 2011, by and between REDUS Kentucky, LLC and Steadfast Asset Holdings, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed February 24, 2012)
10.18	Assignment and Assumption of Purchase Agreement, dated as of February 17, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Renaissance, LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed February 24, 2012)
10.19	Property Management Agreement, dated as of February 17, 2012, by and between SIR Renaissance, LLC and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed February 24, 2012)
10.20	Multifamily Note, dated as of February 17, 2012, by SIR Renaissance, LLC in favor of W&D Interim Lender, LLC (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed February 24, 2012)
10.21	Multifamily Loan and Security Agreement (Non-Recourse), dated as of February 17, 2012, by and between SIR Renaissance, LLC and W&D Interim Lender, LLC (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed February 24, 2012)
10.22	Multifamily Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of February 17, 2012, by SIR Renaissance, LLC in favor of W&D Interim Lender, LLC (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed February 24, 2012)
10.23	Guaranty of Non-Recourse Obligations, dated as of February 17, 2012, by Steadfast Income REIT, Inc. in favor of W&D Interim Lender, LLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed February 24, 2012)
10.24	Environmental Indemnity Agreement, dated as of February 17, 2012, by SIR Renaissance, LLC in favor of W&D Interim Lender, LLC (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed February 24, 2012)
10.25	Purchase and Sale Agreement and Joint Escrow Instructions, dated as of December 9, 2011, by and between WC/TP Spring Creek, LLC and Steadfast Asset Holdings, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed March 15, 2012)
10.26	Assignment and Assumption of Purchase Agreement, dated as of March 9, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Spring Creek, LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed March 15, 2012)
10.27	Property Management Agreement, dated as of March 9, 2012, by and between SIR Spring Creek, LLC and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed March 15, 2012)
10.28	Assumption Agreement, dated as of March 9, 2012, by and among U.S. Bank National Association, as Trustee for the Registered Holders of J.P. Morgan Commercial Securities Corp., Multifamily Mortgage pass-Through Certificates, Series 2011-K702, WC/TP Spring Creek, LLC, SIR Spring Creek, LLC, John A. Wensigner, Steadfast Income REIT Operating Partnership, L.P. and Steadfast Income REIT, Inc. (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed March 15, 2012)
10.29	Multifamily Note, effective as of January 31, 2011, by WC/TP Spring Creek, LLC in favor of Holliday Fenoglio Fowler, L.P. (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed March 15, 2012)
10.30	Allonge to Note, dated as of March 9, 2012, by SIR Spring Creek, LLC in favor of U.S. Bank National Association, as Trustee for the Registered Holders of J.P. Morgan Commercial Securities Corp., Multifamily Mortgage pass-Through Certificates, Series 2011-K702 (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed March 15, 2012)

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10.31	Multifamily Mortgage, Assignment of Rents and Security Agreement (Oklahoma - Revision Date 03-31-2008), dated as of January 31, 2011, by and between WC/TP Spring Creek, LLC and Holliday Fenoglio Fowler, L.P. (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed March 15, 2012)
10.32	Assignment of Management Agreement and Subordination of Management Fees, dated as of March 9, 2012, by and between SIR Spring Creek, LLC, Steadfast Management Company, Inc. and U.S. Bank National Association, as Trustee for the Registered Holders of J.P. Morgan Commercial Securities Corp., Multifamily Mortgage pass-Through Certificates, Series 2011-K702 (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed March 15, 2012)
10.33	Guaranty, dated as of March 9, 2012, by Steadfast Income REIT Operating Partnership, L.P. and Steadfast Income REIT, Inc. for the benefit of U.S. Bank National Association, as Trustee for the Registered Holders of J.P. Morgan Commercial Securities Corp., Multifamily Mortgage pass-Through Certificates, Series 2011-K702 (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed March 15, 2012)
10.34	Amendment No. 2 to the Amended and Restated Advisory Agreement, dated as of April 11, 2012, by and among Steadfast Income REIT, Inc., Steadfast Income REIT Operating Partnership, L.P., and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed April 16, 2012)
10.35	Purchase and Sale Agreement and Joint Escrow Instructions, dated as of January 27, 2012, by and between Steadfast Asset Holdings, Inc. and Montclair Parc Apartments Limited Partnership (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed April 16, 2012)
10.36	Assignment and Assumption of Purchase Agreement, dated as of April 10, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Montclair Parc, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed April 16, 2012)
10.37	First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions, dated April 11, 2012, by and between Montclair Park Apartments Limited Partnership and SIR Montclair Parc, LLC (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed April 16, 2012)
10.38	Multifamily Note, dated April 12, 2012, by SIR Lincoln Tower, LLC in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed April 16, 2012)
10.39	Multifamily Loan and Security Agreement, dated as of April 12, 2012, by and between SIR Lincoln Tower, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed April 16, 2012)
10.40	Multifamily Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of April 12, 2012, by and between SIR Lincoln Tower, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed April 16, 2012)
10.41	Guaranty of Non-Recourse Obligations, dated as of April 12, 2012, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed April 16, 2012)
10.42	Environmental Indemnity Agreement, dated April 12, 2012, by SIR Lincoln Tower, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed April 16, 2012)
10.43	Assignment of Management Agreement, dated as of April 12, 2012, by and among SIR Lincoln Tower, LLC, PNC Bank, National Association and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.10 to the Registrant’s Form 8-K filed April 16, 2012)
10.44	Property Management Agreement, dated as of April 26, 2012, by and between Steadfast Management Company, Inc. and SIR Montclair Parc, LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed May 2, 2012)
10.45	Multifamily Note, dated as of April 26, 2012, by SIR Montclair Parc, LLC, in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed May 2, 2012)
10.46	Multifamily Loan and Security Agreement (Non-Recourse), dated as of April 26, 2012, by and between SIR Montclair Parc, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed May 2, 2012)

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10.47	Multifamily Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of April 26, 2012, by and among SIR Montclair Parc, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed May 2, 2012)
10.48	Assignment of Management Agreement, dated as of April 26, 2012, by and among SIR Montclair Parc, LLC, PNC Bank, National Association and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed May 2, 2012)
10.49	Guaranty of Non-Recourse Obligations, dated as of April 26, 2012, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed May 2, 2012)
10.50	Environmental Indemnity Agreement, dated as of April 26, 2012, by SIR Montclair Parc, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed May 2, 2012)
10.51	Purchase and Sale Agreement, dated as of February 15, 2012, by and between Steadfast Asset Holdings, Inc. and Sonoma Grande Tulsa, LLC and First American Title Insurance Company in its capacity as title insurer (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed May 31, 2012)
10.52	First Amendment to Purchase and Sale Agreement, dated as of March 19, 2012, by and between Steadfast Asset Holdings, Inc. and Sonoma Grande Tulsa, LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed May 31, 2012)
10.53	Second Amendment to Purchase and Sale Agreement, dated as of May 8, 2012, by and between Steadfast Asset Holdings, Inc. and Sonoma Grande Tulsa, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed May 31, 2012)
10.54	Assignment and Assumption of Purchase Agreement, dated as of May 24, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Sonoma Grande, LLC (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed May 31, 2012)
10.55	Property Management Agreement, made as of May 24, 2012, by and between Steadfast Management Company, Inc. and SIR Sonoma Grande, LLC (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed May 31, 2012)
10.56	Multifamily Note, effective as of May 24, 2012, by SIR Sonoma Grande, LLC in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed May 31, 2012)
10.57	Multifamily Loan and Security Agreement, dated as of May 24, 2012, by and between SIR Sonoma Grande, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed May 31, 2012)
10.58	Multifamily Mortgage, Assignment of Rents and Security Agreement, dated as of May 24, 2012, by and between SIR Sonoma Grande, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed May 31, 2012)
10.59	Guaranty, effective as of May 24, 2012, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed May 31, 2012)
10.60	Assignment of Management Agreement and Subordination of Management Fees, effective as of May 24, 2012, by and among SIR Sonoma Grande, LLC, PNC Bank, National Association and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.10 to the Registrant’s Form 8-K filed May 31, 2012)
10.61	Purchase and Sale Agreement, made as of February 15, 2012, by and between Steadfast Asset Holdings, Inc. and Estancia Tulsa, LLC and First American Title Insurance Company in its capacity as escrow agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed July 6, 2012)
10.62	First Amendment to Purchase and Sale Agreement, dated as of May 8, 2012, by and between Steadfast Asset Holdings, Inc. and Estancia Tulsa, LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed July 6, 2012)
10.63	Assignment and Assumption of Purchase Agreement, dated as of June 29, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Estancia, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed July 6, 2012)

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10.64	Property Management Agreement, made as of June 29, 2012, by and between Steadfast Management Company, Inc. and SIR Estancia, LLC (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed July 6, 2012)
10.65	Assumption Agreement, effective as of June 29, 2012, by and among Estancia Tulsa, LLC, SIR Estancia, LLC, Federal Home Loan Mortgage Corporation, Flournoy Development Company, LLC, and Steadfast Income REIT, Inc. (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed July 6, 2012)
10.66	Multifamily Note, effective as of September 6, 2007, by Estancia Tulsa, LLC in favor of CBRE Melody & Company (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed July 6, 2012)
10.67	Multifamily Mortgage, Assignment of Rents and Security Agreement, made as of September 6, 2007, by and between Estancia Tulsa, LLC and CBRE Melody & Company (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed July 6, 2012)
10.68	Guaranty, effective as of June 29, 2012 by Steadfast Income REIT, Inc. to and for the benefit of Federal Home Loan Mortgage Corporation (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed July 6, 2012)
10.69	Subordination of Management Agreement, effective as of June 29, 2012, by and between SIR Estancia, LLC, and Steadfast Management Company, Inc. (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed July 6, 2012)
10.70	Purchase and Sale Agreement and Joint Escrow Instructions, made and entered into as of August 8, 2012, by and between Steadfast Asset Holdings, Inc. and Gary L. Schottenstein and Clean Title, Inc., doing business as Hummel Title Agency, in its capacity as escrow holder (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed October 4, 2012)
10.71	Assignment and Assumption of Purchase Agreement, dated as of September 11, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Hilliard Park, LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed October 4, 2012)
10.72	Membership Interests Assignment and Assumption, made and entered into effective as of September 11, 2012, by and between Gary L. Schottenstein and SIR Hilliard Park, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed October 4, 2012)
10.73	Property Management Agreement, made and entered into as of September 11, 2012, by and between Steadfast Management Company, Inc. and Hilliard Park Partners, L.L.C (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed October 4, 2012)
10.74	Multifamily Note, effective as of September 28, 2012, by Hilliard Park Partners, L.L.C. in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed October 4, 2012)
10.75	Multifamily Loan and Security Agreement, made as of September 28, 2012, by and between Hilliard Park Partners, L.L.C. and PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed October 4, 2012)
10.76	Open-End Multifamily Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of September 28, 2012, by Hilliard Park Partners, L.L.C. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed October 4, 2012)
10.77	Guaranty of Non-Recourse Obligations, dated as of September 28, 2012, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed October 4, 2012)
10.78	Environmental Indemnity Agreement, dated as of September 28, 2012, by Hilliard Park Partners, L.L.C. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed October 4, 2012)
10.79	Purchase and Sale Agreement and Joint Escrow Instructions, made and entered into as of August 8, 2012, by and between HMSREG, LLC, CSL HillMeadows, LTD., Steadfast Asset Holdings, Inc., and Clean Title, Inc., doing business as Hummel Title Agency, in its capacity as escrow holder (incorporated by reference to Exhibit 10.10 to the Registrant’s Form 8-K filed October 4, 2012)

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10.80	Assignment and Assumption of Purchase Agreement, dated as of September 28, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Hilliard Summit, LLC (incorporated by reference to Exhibit 10.11 to the Registrant’s Form 8-K filed October 4, 2012)
10.81	Membership Interests Assignment and Assumption, made and entered into effective as of September 28, 2012, by and between HMSREG, LLC, CSL HillMeadows, LTD., and SIR Hilliard Summit, LLC (incorporated by reference to Exhibit 10.12 to the Registrant’s Form 8-K filed October 4, 2012)
10.82	Property Management Agreement, made and entered into as of September 28, 2012, by and between Steadfast Management Company, Inc. and Hilliard Meadows Apartments, LLC (incorporated by reference to Exhibit 10.13 to the Registrant’s Form 8-K filed October 4, 2012)
10.83	Multifamily Note, effective as of September 28, 2012, by Hilliard Meadows Apartments, LLC in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.14 to the Registrant’s Form 8-K filed October 4, 2012)
10.84	Multifamily Loan and Security Agreement, made as of September 28, 2012, by and between Hilliard Meadows Apartments, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.15 to the Registrant’s Form 8-K filed October 4, 2012)
10.85	Open-End Multifamily Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of September 28, 2012, by Hilliard Meadows Apartments, LLC to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.16 to the Registrant’s Form 8-K filed October 4, 2012)
10.86	Guaranty of Non-Recourse Obligations, dated as of September 28, 2012, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.17 to the Registrant’s Form 8-K filed October 4, 2012)
10.87	Environmental Indemnity Agreement, dated as of September 28, 2012, by Hilliard Meadows Apartments, LLC to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.18 to the Registrant’s Form 8-K filed October 4, 2012)
10.88	Purchase and Sale Agreement and Joint Escrow Instructions, dated November 5, 2012, by and between Steadfast Asset Holdings, Inc., RML Construction, LLP and Chicago Title Insurance Company, in its capacity as Escrow Officer, and acknowledged and agreed to by Forty/57, LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed December 27, 2012)
10.89	First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions, dated as of December 10, 2012, by and between Steadfast Asset Holdings, Inc. and RML Construction, LLP (incorporated by reference to Exhibit 10.2 to the Registration’s Form 8-K filed December 27, 2012)
10.90	Assignment and Assumption of Purchase Agreement, dated as of December 20, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Forty 57, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed December 27, 2012)
10.91	Property Management Agreement, dated as of December 20, 2012, by and between Steadfast Management Company, Inc. and SIR Forty 57, LLC (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed December 27, 2012)
10.92	Multifamily Note, effective as of December 20, 2012, by SIR Forty 57, LLC, in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed December 27, 2012)
10.93	Multifamily Loan and Security Agreement, dated as of December 20, 2012, by and between SIR Forty 57, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed December 27, 2012)
10.94	Multifamily Open-End Mortgage, Assignment of Rents, Security Agreement and Fixture Financing Statement, dated as of December 20, 2012, by and among SIR Forty 57, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed December 27, 2012)
10.95	Guaranty, dated as of December 20, 2012, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed December 27, 2012)

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10.96	Purchase and Sale Agreement and Joint Escrow Instructions, made and entered into as of November 2, 2012, by and between Steadfast Asset Holdings, Inc., Gary L. Schottenstein, Brett Kaufman and Clean Title, Inc., doing business as Hummel Title Agency, in its capacity as escrow holder (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed January 7, 2013)
10.97	First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions, entered into as of November 13, 2012, by and between Steadfast Asset Holdings, Inc., Gary L. Schottenstein and Brett Kaufman (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed January 7, 2013)
10.98	Assignment and Assumption of Purchase Agreement, dated as of December 31, 2012, by and between Steadfast Asset Holdings, Inc. and SIR Hilliard Grand, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed January 7, 2013)
10.99	Membership Interests Assignment and Assumption, made and entered into effective as of December 31, 2012, by and between Gary L. Schottenstein and SIR Hilliard Grand, LLC (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed January 7, 2013)
10.100	Property Management Agreement, made and entered into as of December 31, 2012, by and between Steadfast Management Company, Inc. and Hilliard Grand Apartments, LLC (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed January 7, 2013)
10.101	Mortgage Note, effective as of July 27, 2010, by Hilliard Grand Apartments, LLC in favor of Red Mortgage Capital, LLC (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed January 7, 2013)
10.102	Modification of Mortgage Note, dated as of December 31, 2012, by and between Hilliard Grand Apartments, LLC in favor of Red Mortgage Capital, LLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 8-K filed January 7, 2013)
10.103	Loan Modification Agreement, made as of December 28, 2012, by and among Hilliard Grand Apartments, LLC, Red Mortgage Capital, LLC and the Secretary of Housing and Urban Development (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed January 7, 2013)
10.104	Open-End Mortgage Deed, dated as of July 27, 2010, by Hilliard Grand Apartments, LLC to and for the benefit of Red Mortgage Capital, LLC (incorporated by reference to Exhibit 10.9 to the Registrant’s Form 8-K filed January 7, 2013)
10.105	Amendment No. 3 to the Amended and Restated Advisory Agreement, dated as of March 13, 2013, by and among Steadfast Income REIT, Inc., Steadfast Income REIT Operating Partnership, L.P. and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K filed March 25, 2013)
10.106	Amendment No. 4 to the Amended and Restated Advisory Agreement, dated as of May 14, 2013, by and among Steadfast Income REIT, Inc., Steadfast Income REIT Operating Partnership, L.P. and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.1 of the Registrant's Form 8-K filed May 17, 2013)
10.107	Real Estate Purchase and Sale Agreement, made and entered into as of August 23, 2013, between Steadfast Asset Holdings, Inc., TEL-LA Villas Kingwood, LLC, TEL-LA Champion Forest, LLC, TEL-LA Carrington Huffmeister, LLC, TEL-LA Villas Huffmeister, LLC, TEL-LA Riata Ranch, LLC, and TEL-LA Carrington Place Apartments, LLC, and First American Title Insurance Company, in its capacity as Escrowholder (incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K filed November 14, 2013)
10.108	Assignment and Assumption of Purchase Agreement, dated as of October 4, 2013, by and between Steadfast Asset Holdings, Inc. and SIR Waterford Riata, LLC (incorporated by reference to Exhibit 10.2 to the Registrant's Form 8-K filed November 14, 2013)
10.109	Property Management Agreement, made and entered into as of October 10, 2013, by and between Steadfast Management Company, Inc. and SIR Waterford Riata, LLC (incorporated by reference to Exhibit 10.3 to the Registrant's Form 8-K filed November 14, 2013)
10.110	Multifamily Note, effective as of October 10, 2013, by SIR Waterford Riata, LLC, in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.4 to the Registrant's Form 8-K filed November 14, 2013)
10.111	Multifamily Loan and Security Agreement, dated as of October 10, 2013, by and between SIR Waterford Riata, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.5 to the Registrant's Form 8-K filed November 14, 2013)

92

10.112	Multifamily Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing, dated as of October 10, 2013, by and among SIR Waterford Riata, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.6 to the Registrant's Form 8-K filed November 14, 2013)
10.113	Guaranty, dated as of October 10, 2013, by Steadfast Income REIT, Inc. for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.7 to the Registrant's Form 8-K filed November 14, 2013)
10.114	Assignment and Assumption of Purchase Agreement, dated as of October 4, 2013, by and between Steadfast Asset Holdings, Inc. and SIR Huffmeister Villas, LLC (incorporated by reference to Exhibit 10.8 to the Registrant's Form 8-K filed November 14, 2013)
10.115	Property Management Agreement, made and entered into as of October 10, 2013, by and between Steadfast Management Company, Inc. and SIR Huffmeister Villas, LLC (incorporated by reference to Exhibit 10.9 to the Registrant's Form 8-K filed November 14, 2013)
10.116	Multifamily Note, effective as of October 10, 2013, by SIR Huffmeister Villas, LLC, in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.10 to the Registrant's Form 8-K filed November 14, 2013)
10.117	Multifamily Loan and Security Agreement, dated as of October 10, 2013, by and between SIR Huffmeister Villas, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.11 to the Registrant's Form 8-K filed November 14, 2013)
10.118	Multifamily Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing, dated as of October 10, 2013, by and among SIR Huffmeister Villas, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.12 to the Registrant's Form 8-K filed November 14, 2013)
10.119	Guaranty, dated as of October 10, 2013, by Steadfast Income REIT, Inc. to and for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.13 to the Registrant's Form 8-K filed November 14, 2013)
10.120	Assignment and Assumption of Purchase Agreement, dated as of October 4, 2013, by and between Steadfast Asset Holdings, Inc. and SIR Kingwood Villas, LLC (incorporated by reference to Exhibit 10.14 to the Registrant's Form 8-K filed November 14, 2013)
10.121	Property Management Agreement, made and entered into as of October 10, 2013, by and between Steadfast Management Company, Inc. and SIR Kingwood Villas, LLC (incorporated by reference to Exhibit 10.15 to the Registrant's Form 8-K filed November 14, 2013)
10.122	Multifamily Note, effective as of October 10, 2013, by SIR Kingwood Villas, LLC, in favor of PNC Bank, National Association (incorporated by reference to Exhibit 10.16 to the Registrant's Form 8-K filed November 14, 2013)
10.123	Multifamily Loan and Security Agreement, dated as of October 10, 2013, by and between SIR Kingwood Villas, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.17 to the Registrant's Form 8-K filed November 14, 2013)
10.124	Multifamily Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing, dated as of October 10, 2013, by and among SIR Kingwood Villas, LLC and PNC Bank, National Association (incorporated by reference to Exhibit 10.18 to the Registrant's Form 8-K filed November 14, 2013)
10.125	Guaranty, dated as of October 10, 2013, by Steadfast Income REIT, Inc. for the benefit of PNC Bank, National Association (incorporated by reference to Exhibit 10.19 to the Registrant's Form 8-K filed November 14, 2013)
10.126	Assignment and Assumption of Purchase Agreement, dated as of November 1, 2013, by and between Steadfast Asset Holdings, Inc. and SIR Carrington Park, LLC (incorporated by reference to Exhibit 10.20 to the Registrant's Form 8-K filed November 14, 2013)
10.127	Property Management Agreement, made and entered into as of November 7, 2013, by and between Steadfast Management Company, Inc. and SIR Carrington Park, LLC (incorporated by reference to Exhibit 10.21 to the Registrant's Form 8-K filed November 14, 2013)
10.128	Multifamily Note, effective as of November 7, 2013, by SIR Carrington Park, LLC, in favor of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.22 to the Registrant's Form 8-K filed November 14, 2013)

93

10.129	Multifamily Loan and Security Agreement, dated as of November 7, 2013, by and between SIR Carrington Park, LLC and Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.23 to the Registrant's Form 8-K filed November 14, 2013)
10.130	Multifamily Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of November 7, 2013, by and among SIR Carrington Park, LLC and Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.24 to the Registrant's Form 8-K filed November 14, 2013)
10.131	Guaranty of Non-Recourse Obligations, dated as of November 7, 2013, by Steadfast Income REIT, Inc. to and for the benefit of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.25 to the Registrant's Form 8-K filed November 14, 2013)
10.132	Environmental Indemnity Agreement, dated as of November 7, 2013, by SIR Carrington Park, LLC, to and for the benefit of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.26 to the Registrant's Form 8-K filed November 14, 2013)
10.133	Assignment and Assumption of Purchase Agreement, dated as of November 1, 2013, by and between Steadfast Asset Holdings, Inc. and SIR Carrington Champion, LLC (incorporated by reference to Exhibit 10.27 to the Registrant's Form 8-K filed November 14, 2013)
10.134	Property Management Agreement, made and entered into as of November 7, 2013, by and between Steadfast Management Company, Inc. and SIR Carrington Champion, LLC (incorporated by reference to Exhibit 10.28 to the Registrant's Form 8-K filed November 14, 2013)
10.135	Multifamily Note, effective as of November 7, 2013, by SIR Carrington Champion, LLC, in favor of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.29 to the Registrant's Form 8-K filed November 14, 2013)
10.136	Multifamily Loan and Security Agreement, dated as of November 7, 2013, by and between SIR Carrington Champion, LLC and Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.30 to the Registrant's Form 8-K filed November 14, 2013)
10.137	Multifamily Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of November 7, 2013, by and among SIR Carrington Champion, LLC and Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.31 to the Registrant's Form 8-K filed November 14, 2013)
10.138	Guaranty of Non-Recourse Obligations, dated as of November 7, 2013, by Steadfast Income REIT, Inc. to and for the benefit of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.32 to the Registrant's Form 8-K filed November 14, 2013)
10.139	Environmental Indemnity Agreement, dated as of November 7, 2013, by SIR Carrington Champion, LLC, to and for the benefit of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.33 to the Registrant's Form 8-K filed November 14, 2013)
10.140	Assignment and Assumption of Purchase Agreement, dated as of November 1, 2013, by and between Steadfast Asset Holdings, Inc. and SIR Carrington Place, LLC (incorporated by reference to Exhibit 10.34 to the Registrant's Form 8-K filed November 14, 2013)
10.141	Property Management Agreement, made and entered into as of November 7, 2013, by and between Steadfast Management Company, Inc. and SIR Carrington Place, LLC (incorporated by reference to Exhibit 10.35 to the Registrant's Form 8-K filed November 14, 2013)
10.142	Multifamily Note, effective as of November 7, 2013, by SIR Carrington Place, LLC, in favor of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.36 to the Registrant's Form 8-K filed November 14, 2013)
10.143	Multifamily Loan and Security Agreement, dated as of November 7, 2013, by and between SIR Carrington Place, LLC and Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.37 to the Registrant's Form 8-K filed November 14, 2013)
10.144	Multifamily Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of November 7, 2013, by and among SIR Carrington Place, LLC and Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.38 to the Registrant's Form 8-K filed November 14, 2013)
10.145	Guaranty of Non-Recourse Obligations, dated as of November 7, 2013, by Steadfast Income REIT, Inc. to and for the benefit of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.39 to the Registrant's Form 8-K filed November 14, 2013)

94

10.146	Environmental Indemnity Agreement, dated as of November 7, 2013, by SIR Carrington Place, LLC, to and for the benefit of Berkeley Point Capital LLC (incorporated by reference to Exhibit 10.40 to the Registrant's Form 8-K filed November 14, 2013)
10.147	Amendment No. 5 to the Amended and Restated Advisory Agreement, dated as of March 12, 2014, by and among Steadfast Income REIT, Inc., Steadfast Income REIT Operating Partnership, L.P. and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K filed March 13, 2014)
10.148	Restricted Stock Agreement, dated as of June 11, 2014, by and among Steadfast Income REIT, Inc. and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K filed June 13, 2014)
10.149	Amendment No. 6 to the Amended and Restated Advisory Agreement, dated as of June 11, 2014, by and among Steadfast Income REIT, Inc., Steadfast Income REIT Operating Partnership, L.P. and Steadfast Income Advisor, LLC (incorporated by reference to Exhibit 10.2 to the Registrant's Form 8-K filed June 13, 2014)
21	Subsidiaries of the Company
23.1	Consent of Ernst & Young LLP
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
99.1	Consent of CBRE, Inc.
99.2	Consent of CBRE Capital Advisors, Inc.
101.INS	XBRL Instance Document (Furnished herewith)
101.SCH	XBRL Schema Document (Furnished herewith)
101.CAL	XBRL Calculation Linkbase Document (Furnished herewith)
101.LAB	XBRL Labels Linkbase Document (Furnished herewith)
101.PRE	XBRL Presentation Linkbase Document (Furnished herewith)
101.DEF	XBRL Definition Linkbase Document (Furnishced herewith)

95

STEADFAST INCOME REIT, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets as of December 31, 2014 and 2013	F-3
Consolidated Statements of Operations for the Years Ended December 31, 2014, 2013 and 2012	F-4
Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2014, 2013 and 2012	F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 2014, 2013 and 2012	F-6
Notes to Consolidated Financial Statements	F-8
Financial Statement Schedule
Schedule III - Real Estate Assets and Accumulated Depreciation and Amortization	F-47

All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of

Steadfast Income REIT, Inc.

We have audited the accompanying consolidated balance sheets of Steadfast Income REIT, Inc. (the “Company”) as of December 31, 2014 and 2013, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2014. Our audits also included the financial statement schedule listed in the Index at Item 15(a), Schedule III - Real Estate Assets and Accumulated Depreciation and Amortization. These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Steadfast Income REIT, Inc. at December 31, 2014 and 2013, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2014, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects, the information set forth therein.

/s/ Ernst & Young LLP

Irvine, California

March 18, 2015

F-2

STEADFAST INCOME REIT, INC.

CONSOLIDATED BALANCE SHEETS

	December 31,
	2014			2013
ASSETS
Assets:
Real Estate:
Land	$	174,102,422		$	162,425,511
Building and improvements	1,457,633,918			1,316,608,491
Tenant origination and absorption costs	524,712			15,588,747
Other intangible assets	2,644,263			2,644,263
Construction-in-progress	2,048,098			—
Total real estate held for investment, cost	1,636,953,413			1,497,267,012
Less accumulated depreciation and amortization	(98,342,452		)	(46,376,515		)
Total real estate held for investment, net	1,538,610,961			1,450,890,497
Real estate held for sale, net	—			20,072,662
Total real estate, net	1,538,610,961			1,470,963,159
Cash and cash equivalents	29,529,312			19,552,205
Restricted cash	25,478,939			24,978,312
Rents and other receivables	1,992,310			28,555,764
Assets related to real estate held for sale	—			265,004
Deferred financing costs and other assets, net	13,455,606			17,575,410
Total assets	$	1,609,067,128		$	1,561,889,854
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Accounts payable and accrued liabilities	$	39,527,928		$	30,372,692
Below-market leases, net	—			163,237
Notes payable:
Mortgage notes payable, net	1,070,757,025			969,989,740
Revolving credit facility	14,000,000			—
Mortgage notes payable related to real estate held for sale	—			17,340,060
Total notes payable, net	1,084,757,025			987,329,800
Distributions payable	4,679,455			4,058,452
Due to affiliates, net	3,039,490			9,322,038
Liabilities related to real estate held for sale	—			580,100
Total liabilities	1,132,003,898			1,031,826,319
Commitments and contingencies (Note 10)
Redeemable common stock	—			12,945,007
Stockholders’ Equity:
Preferred stock, $0.01 par value per share; 100,000,000 shares authorized, no shares issued and outstanding	—			—
Common stock $0.01 par value per share; 999,999,000 shares authorized, 76,858,483 and 74,153,580 shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively	768,585			741,538
Convertible stock, $0.01 par value per share; 1,000 shares authorized, issued and outstanding as of December 31, 2014 and December 31, 2013, respectively	10			10
Additional paid-in capital	680,138,132			640,181,521
Cumulative distributions and net losses	(203,843,497		)	(123,804,541		)
Total stockholders’ equity	477,063,230			517,118,528
Total liabilities and stockholders’ equity	$	1,609,067,128		$	1,561,889,854

See accompanying notes to consolidated financial statements.

F-3

STEADFAST INCOME REIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

	For the year ended December 31,
	2014			2013			2012
Revenues:
Rental income	$	175,267,082		$	98,018,275		$	27,955,977
Tenant reimbursements and other	20,662,774			11,083,242			2,630,955
Total revenues	195,929,856			109,101,517			30,586,932
Expenses:
Operating, maintenance and management	52,427,001			28,708,239			8,687,480
Real estate taxes and insurance	34,750,097			17,499,798			3,721,952
Fees to affiliates	23,923,921			30,713,737			13,127,558
Depreciation and amortization	69,681,177			48,454,178			14,957,857
Interest expense	40,370,846			24,308,402			6,291,193
Loss on debt extinguishment	1,939,817			—			—
General and administrative expenses	6,896,519			7,106,568			3,085,470
Acquisition costs	1,626,904			8,169,451			3,275,349
Total expenses	231,616,282			164,960,373			53,146,859
Loss from continuing operations	(35,686,426		)	(55,858,856		)	(22,559,927		)
Gain (loss) on sales of real estate, net	9,944,134			(21,001		)	—
Net loss	$	(25,742,292	)	$	(55,879,857	)	$	(22,559,927	)
Loss per common share — basic and diluted	$	(0.34	)	$	(1.39	)	$	(1.84	)
Weighted average number of common shares outstanding — basic and diluted	75,450,215			40,169,940			12,238,094

See accompanying notes to consolidated financial statements.

F-4

STEADFAST INCOME REIT, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2014, 2013 AND 2012

	Common Stock					Convertible Stock			Additional Paid- In Capital			Cumulative Distributions & Net Losses			Total Stockholders’ Equity
	Shares		Amount			Shares	Amount
BALANCE, December 31, 2011	4,638,699		$	46,387		1,000	$	10	$	38,260,059		$	(8,082,838	)	$	30,223,618
Issuance of common stock	18,314,135		183,139			—	—		182,891,102			—			183,074,241
Commissions on sales of common stock and related dealer manager fees to affiliates	—		—			—	—		(17,154,479		)	—			(17,154,479		)
Transfers to redeemable common stock	—		—			—	—		(2,722,156		)	—			(2,722,156		)
Redemption of common stock	(43,975	)	(440		)	—	—		(417,293		)	—			(417,733		)
Other offering costs to affiliates	—		—			—	—		(9,820,681		)	—			(9,820,681		)
Distributions declared	—		—			—	—		—			(8,636,158		)	(8,636,158		)
Amortization of stock-based compensation	—		—			—	—		94,425			—			94,425
Net loss for the year ended December 31, 2012	—		—			—	—		—			(22,559,927		)	(22,559,927		)
BALANCE, December 31, 2012	22,908,859		229,086			1,000	10		191,130,977			(39,278,923		)	152,081,150
Issuance of common stock	51,373,960		513,743			—	—		522,554,977			—			523,068,720
Commissions on sales of common stock and related dealer manager fees to affiliates	—		—			—	—		(49,014,259		)	—			(49,014,259		)
Transfers to redeemable common stock	—		—			—	—		(10,078,483		)	—			(10,078,483		)
Redemption of common stock	(129,239	)	(1,291		)	—	—		(1,245,009		)	—			(1,246,300		)
Other offering costs to affiliates	—		—			—	—		(13,271,892		)	—			(13,271,892		)
Distributions declared	—		—			—	—		—			(28,645,761		)	(28,645,761		)
Amortization of stock-based compensation	—		—			—	—		105,210			—			105,210
Net loss for the year ended December 31, 2013	—		—			—	—		—			(55,879,857		)	(55,879,857		)
BALANCE, December 31, 2013	74,153,580		741,538			1,000	10		640,181,521			(123,804,541		)	517,118,528
Issuance of common stock	2,496,806		24,968			—	—		24,170,846			—			24,195,814
Issuance of restricted common stock to Advisor	488,281		4,883			—	—		4,995,117			—			5,000,000
Transfers from redeemable common stock	—		—			—	—		13,393,647			—			13,393,647
Redemption of common stock	(280,184	)	(2,804		)	—	—		(2,721,144		)	—			(2,723,948		)
Distributions declared	—		—			—	—		—			(54,296,664		)	(54,296,664		)
Amortization of stock-based compensation	—		—			—	—		118,145			—			118,145
Net loss for the year ended December 31, 2014	—		—			—	—		—			(25,742,292		)	(25,742,292		)
BALANCE, December 31, 2014	76,858,483		$	768,585		1,000	$	10	$	680,138,132		$	(203,843,497	)	$	477,063,230

See accompanying notes to consolidated financial statements.

F-5

STEADFAST INCOME REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the year ended December 31,
	2014			2013			2012
Cash Flows from Operating Activities:
Net loss	$	(25,742,292	)	$	(55,879,857	)	$	(22,559,927	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	69,681,177			48,454,178			14,957,857
Accretion of below-market leases	(163,237		)	(1,108,789		)	(138,703		)
Amortization of deferred financing costs	1,489,834			976,198			225,614
Amortization of stock-based compensation	118,145			105,210			94,425
Amortization of loan premiums and discounts	(1,234,793		)	(987,970		)	(332,348		)
Change in fair value of interest rate cap agreements	4,353,301			448,984			162,761
Loss on debt extinguishment	145,816			—			—
(Gain) loss on sales of real estate	(9,944,134		)	21,001			—
Changes in operating assets and liabilities:
Restricted cash for operating activities	(1,166,924		)	(15,809,338		)	(4,062,793		)
Rents and other receivables	8,622			(1,182,658		)	(720,767		)
Other assets	164,858			(3,042,967		)	(1,070,522		)
Accounts payable and accrued liabilities	9,023,776			22,898,966			6,816,685
Due to affiliates, net	1,822,698			2,857,909			2,064,522
Net cash provided by (used in) operating activities	48,556,847			(2,249,133		)	(4,563,196		)
Cash Flows from Investing Activities:
Acquisition of real estate investments	(126,718,757		)	(818,138,356		)	(378,132,177		)
Additions to real estate investments	(26,806,870		)	(9,125,416		)	(3,116,467		)
Escrow deposits for pending real estate acquisitions	(3,120,400		)	(12,189,020		)	(374,900		)
Restricted cash for investing activities	931,301			(3,966,759		)	(586,078		)
Purchase of interest rate caps	(863,934		)	(5,778,436		)	(295,870		)
Proceeds from sales of real estate, net	29,761,182			68,999			—
Net cash used in investing activities	(126,817,478		)	(849,128,988		)	(382,505,492		)
Cash Flows from Financing Activities:
Proceeds from issuance of mortgage notes payable	156,238,185			476,799,000			249,104,000
Principal payments on mortgage notes payable	(71,576,167		)	(16,690,976		)	(14,432,386		)
Borrowings from credit facility	49,000,000			62,500,000			5,000,000
Principal payments on credit facility	(35,000,000		)	(67,500,000		)	—
Proceeds from issuance of common stock	26,561,229			485,786,997			179,849,886
Payments of commissions on sales of common stock and related dealer manager fees to affiliates	—			(49,014,259		)	(17,154,479		)
Reimbursement of other offering costs to affiliates	(3,105,246		)	(10,279,559		)	(9,799,471		)
Payment of deferred financing costs	(1,664,326		)	(4,650,578		)	(3,377,941		)
Distributions to common stockholders	(29,491,989		)	(14,302,663		)	(4,375,205		)
Redemptions of common stock	(2,723,948		)	(1,246,300		)	(417,733		)
Net cash provided by financing activities	88,237,738			861,401,662			384,396,671
Net increase in cash and cash equivalents	9,977,107			10,023,541			(2,672,017		)
Cash and cash equivalents, beginning of year	19,552,205			9,528,664			12,200,681
Cash and cash equivalents, end of year	$	29,529,312		$	19,552,205		$	9,528,664

F-6

STEADFAST INCOME REIT, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)

Supplemental Disclosure of Cash Flow Information:
Interest paid, net of amounts capitalized of $41,898, $0 and $0 for the years ended December 31, 2014, 2013 and 2012	$	35,432,090	$	22,183,329		$	5,518,378
Supplemental Disclosure of Noncash Transactions:
Increase in distributions payable	$	621,003	$	2,715,053		$	1,088,807
Assumption of mortgage notes payable to acquire real estate	$	—	$	115,535,815		$	124,215,072
Application of escrow deposits to acquire real estate	$	3,620,400	$	12,864,120		$	—
Premiums on assumed mortgage notes payable	$	—	$	3,871,543		$	3,370,366
Issuance of mortgage notes payable to acquire real estate	$	—	$	—		$	2,275,000
Increase in amounts receivable from transfer agent	$	—	$	(25,958,231	)	$	(84,905	)
Increase in amounts payable to affiliates for other offering costs	$	—	$	2,992,333		$	21,210
Distributions paid to common stockholders through common stock issuances pursuant to the distribution reinvestment plan	$	24,183,672	$	11,628,045		$	3,172,149
Issuance of restricted common stock to settle liability	$	5,000,000	$	—		$	—
Decrease (increase) in redeemable common stock, net	$	13,393,647	$	(10,078,483	)	$	(2,723,947	)
Increase in redeemable common stock payable	$	—	$	182,997		$	59,884

See accompanying notes to consolidated financial statements.

F-7

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014

1. Organization and Business

Steadfast Income REIT, Inc. (the “Company”) was formed on May 4, 2009, as a Maryland corporation that has elected to qualify as a real estate investment trust (“REIT”). On June 12, 2009, the Company was initially capitalized pursuant to the sale of 22,223 shares of common stock to Steadfast REIT Investments, LLC (the “Sponsor”) at a purchase price of $9.00 per share for an aggregate purchase price of $200,007. On July 10, 2009, Steadfast Income Advisor, LLC (the “Advisor”), a Delaware limited liability company formed on May 1, 2009, invested $1,000 in the Company in exchange for 1,000 shares of convertible stock (the “Convertible Stock”) as described in Note 6.

Substantially all of the Company’s business is conducted through Steadfast Income REIT Operating Partnership, L.P., a Delaware limited partnership formed on July 6, 2009 (the “Operating Partnership”). The Company is the sole general partner of the Operating Partnership. The Company and Advisor entered into an Amended and Restated Limited Partnership Agreement of the Operating Partnership (the “Partnership Agreement”) on September 28, 2009.

As of December 31, 2014, the Company owned 65 multifamily properties comprising a total of 16,526 apartment homes and 25,973 square feet of rentable commercial space. For more information on the Company’s real estate portfolio, see Note 3.

Private Offering

On October 13, 2009, the Company commenced a private offering of up to $94,000,000 in shares of the Company’s common stock at a purchase price of $9.40 per share (with discounts available for certain categories of purchasers) (the “Private Offering”). The Company offered its shares of common stock for sale in the Private Offering pursuant to a confidential private placement memorandum and only to persons that were “accredited investors,” as that term is defined under the Securities Act of 1933, as amended, and Regulation D promulgated thereunder. On July 9, 2010, the Company terminated the Private Offering and on July 19, 2010, the Company commenced its registered public offering described below. The Company sold 637,279 shares of common stock in the Private Offering for gross offering proceeds of $5,844,325.

Public Offering

On July 23, 2009, the Company filed a registration statement on Form S-11 with the Securities and Exchange Commission (the “SEC”) to offer a maximum of 150,000,000 shares of common stock for sale to the public at an initial price of $10.00 per share (with discounts available for certain categories of purchasers) (the “Primary Offering”). The Company also registered up to 15,789,474 shares of common stock for sale pursuant to the Company’s distribution reinvestment plan (the “DRP,” and together with the Primary Offering, the “Public Offering”) at an initial price of $9.50 per share.The SEC declared the Company’s registration statement effective on July 9, 2010. The Company commenced the Public Offering on July 19, 2010.

On July 12, 2012, the Company’s board of directors determined an estimated value per share of the Company’s common stock as of March 31, 2012 of $10.24. As a result of the determination of the estimated value per share of the Company’s common stock as of March 31, 2012, effective September 10, 2012, the offering price of the Company’s common stock to the public in the Primary Offering increased from the previous price of $10.00 per share to $10.24 per share. Additionally, effective September 10, 2012, the price of shares of the Company’s common stock issued pursuant to the DRP increased from a price of $9.50 per share to a price of $9.73 per share, or 95% of the new Primary Offering price of $10.24 per share. Effective September 10, 2012, the Company’s board of directors increased the amount of distributions paid on each share of the Company’s common stock from $0.001917 per share per day to $0.001964 per share per day, which, if paid each day over a 365-day period, is equivalent to a 7.0% annualized distribution rate based on the new offering price of $10.24 per share. The Company’s board of directors may again, in its sole discretion, change the price at which the Company offers shares of common stock to its stockholders pursuant to the DRP to reflect future changes in the Company’s estimated value per share and other factors that the Company’s board of directors deems relevant. See “—Note 14. Subsequent Events” for further information regarding the estimated value per share.

F-8

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

The Company terminated its Public Offering on December 20, 2013. Following termination of the Public Offering, the Company continued to offer shares of common stock pursuant to the DRP until the Company’s board of directors suspended the DRP effective November 20, 2014. Through December 20, 2013, the Company sold 73,608,337 shares of common stock in the Public Offering for gross proceeds of $745,389,748, including 1,588,289 shares of common stock issued pursuant to the DRP for gross offering proceeds of $15,397,232.

The business of the Company is externally managed by the Advisor, pursuant to the Advisory Agreement by and among the Company, the Operating Partnership and the Advisor (as amended, the “Advisory Agreement”), which is subject to annual renewal by the Company’s board of directors. The current term of the Advisory Agreement expires on May 3, 2015. Subject to certain restrictions and limitations, the Advisor manages the Company’s day-to-day operations, manages the Company’s portfolio of properties and real estate-related assets, sources and presents investment opportunities to the Company’s board of directors and provides investment management services on the Company’s behalf. Steadfast Capital Markets Group, LLC (the “Dealer Manager”), an affiliate of the Company, served as the dealer manager for the Public Offering. The Dealer Manager was responsible for marketing the Company’s shares of common stock being offered pursuant to the Public Offering. The Advisor, along with the Dealer Manager, also provides marketing, investor relations and other administrative services on the Company’s behalf.

The Partnership Agreement provides that the Operating Partnership is operated in a manner that will enable the Company to (1) satisfy the requirements for being classified as a REIT for tax purposes, (2) avoid any federal income or excise tax liability and (3) ensure that the Operating Partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), which classification could result in the Operating Partnership being taxed as a corporation, rather than as a partnership. In addition to the administrative and operating costs and expenses incurred by the Operating Partnership in acquiring and operating real properties, the Operating Partnership will pay all of the Company’s administrative costs and expenses, and such expenses will be treated as expenses of the Operating Partnership.

2. Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company, the Operating Partnership and its subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements of the Company’s subsidiaries are prepared using accounting policies consistent with those of the Company.

The accompanying consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC.

Square footage, occupancy and other measures used to describe real estate included in the notes to the consolidated financial statements are presented on an unaudited basis.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Reclassifications

Certain prior year amounts in the consolidated financial statements have been reclassified to conform with the current year presentation. These reclassifications have not changed the results of operations of prior periods. During the year ended December 31, 2014, the Company disposed of three apartment communities. As a result, certain assets and liabilities were classified as held for sale on the consolidated balance sheets for all periods presented.

F-9

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Real Estate Assets

Depreciation and Amortization

Real estate costs related to the development, construction and improvement of properties are capitalized. Acquisition costs related to business combinations are expensed as incurred. Acquisition costs related to asset acquisitions are capitalized. Repair and maintenance and tenant turnover costs are charged to expense as incurred and significant replacements and betterments are capitalized. Repair and maintenance and tenant turnover costs include all costs that do not extend the useful life of the real estate asset. The Company considers the period of future benefit of an asset to determine its appropriate useful life and anticipates the estimated useful lives of assets by class to be generally as follows:

Buildings	27.5 years
Building improvements	5-25 years
Tenant improvements	Shorter of lease term or expected useful life
Tenant origination and absorption costs	Remaining term of related lease
Furniture, fixtures, and equipment	5-10 years

Real Estate Purchase Price Allocation

The Company records the acquisition of income-producing real estate or real estate that will be used for the production of income as a business combination. All assets acquired and liabilities assumed in a business combination are measured at their acquisition-date fair values. Acquisition costs are expensed as incurred.

The Company assesses the acquisition-date fair values of all tangible assets, identifiable intangible assets and assumed liabilities using methods similar to those used by independent appraisers (e.g., discounted cash flow analysis) and that utilize appropriate discount and/or capitalization rates and available market information. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions. The fair value of tangible assets of an acquired property considers the value of the property as if it was vacant.

Intangible assets include the value of in-place leases, which represents the estimated value of the net cash flows of the in-place leases to be realized, 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.

The Company estimates the value of tenant origination and absorption costs by considering the estimated carrying costs during hypothetical expected lease-up periods, considering current market conditions. In estimating carrying costs, the Company estimates the amount of lost rentals using market rates during the expected lease-up periods.

The Company amortizes the value of in-place leases to expense over the remaining non-cancelable term of the respective leases. Should a tenant terminate its lease, the unamortized portion of the in-place lease value and customer relationship intangibles would be charged to expense in that period.

The Company records above-market and below-market in-place lease values for acquired properties based on the present value (using an interest rate that reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) the Company’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable term of the lease. The Company amortizes any capitalized above-market or below-market lease values as a reduction or increase to rental income over the remaining non-cancelable terms of the respective leases.

F-10

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

The total amount of other lease-related intangible assets acquired will be further allocated to in-place lease values and customer relationship intangible values based on the Company’s evaluation of the specific characteristics of each tenant’s lease and its overall relationship with that respective tenant. Characteristics that the Company considers in allocating these values include the nature and extent of existing business relationships with the tenant, growth prospects for developing new business with the tenant, and the tenant’s credit quality and expectations of lease renewals (including those existing under the terms of the lease agreement), among other factors.

The total amount of non-lease-related intangible assets, including amenity access agreements, tax abatement agreements or other contract rights assumed as part of the acquisition of certain properties, will be allocated to other intangible assets based on the present value of the difference between contractual amounts to be paid pursuant to the contracts assumed and the Company's estimate of the fair market contract rates for corresponding contracts measured over a period equal to the remaining non-cancelable term of the contracts assumed. Other intangible assets are amortized using the straight-line method over the remaining non-cancelable term of the related contracts.

Estimates of the fair values of the tangible assets, identifiable intangible assets and assumed liabilities require the Company to make significant assumptions to estimate market lease rates, property-operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods, and the number of years the property will be held for investment. The use of inappropriate assumptions could result in an incorrect valuation of acquired tangible assets, identifiable intangible assets and assumed liabilities, which could impact the amount of the Company’s net income (loss).

Sale of Real Estate Assets

Property sales or dispositions are recorded when title transfers to unrelated third parties, contingencies have been removed and sufficient cash consideration has been received by the Company. Upon disposition, the related costs and accumulated depreciation are removed from the respective accounts. Any gain or loss on sale is recognized in accordance with GAAP.

The Company classifies real estate assets as real estate held for sale once the criteria, as defined by GAAP, have been met.

Impairment of Real Estate Assets

The Company will continually monitor events and changes in circumstances that could indicate that the carrying amounts of the Company’s real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets and liabilities may not be recoverable, the Company assesses the recoverability of the assets by estimating whether the Company will recover the carrying value of the asset through its undiscounted future cash flows and its eventual disposition. Based on this analysis, if the Company does not believe that it will be able to recover the carrying value of the real estate and related intangible assets and liabilities, the Company records an impairment loss to the extent that the carrying value exceeds the estimated fair value of the real estate and related intangible assets and liabilities. If any assumptions, projections or estimates regarding an asset changes in the future, the Company may have to record an impairment to reduce the net book value of such individual asset. The Company did not record any impairment loss on its real estate assets during the years ended December 31, 2014, 2013 and 2012.

Rents and Other Receivables

The Company will periodically evaluate the collectability of amounts due from tenants and maintain an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required payments under lease agreements. The Company exercises judgment in establishing these allowances and considers payment history and current credit status of tenants in developing these estimates. Due to the short-term nature of the operating leases, the Company does not maintain a deferred rent receivable related to the straight-lining of rents.

Revenue Recognition

The Company leases apartment and condominium units under operating leases with terms generally of one year or less. Generally, credit investigations are performed for prospective residents and security deposits are obtained. The Company will recognize minimum rent, including rental abatements, concessions and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the related lease and amounts expected to be received in later years will be

F-11

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

recorded as deferred rents. The Company records property operating expense reimbursements due from tenants for common area maintenance, real estate taxes, and other recoverable costs in the period the related expenses are incurred.

The Company recognizes gains on sales of real estate either in total or deferred for a period of time, depending on whether a sale has been consummated, the extent of the buyer’s investment in the property being sold, whether the receivable is subject to future subordination, and the degree of the Company’s continuing involvement with the property after the sale. If the criteria for profit recognition under the full-accrual method are not met, the Company will defer gain recognition and account for the continued operations of the property by applying the percentage-of-completion, reduced profit, deposit, installment or cost recovery method, as appropriate, until the appropriate criteria are met.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents may include cash and short-term investments. Short-term investments are stated at cost, which approximates fair value. As of December 31, 2014 and 2013, the Company had amounts in excess of federally insured limits in deposit accounts with a financial institution. The Company limits such deposits to financial institutions with high credit standing.

Restricted Cash

Restricted cash represents those cash accounts for which the use of funds is restricted by loan covenants. As of December 31, 2014 and 2013, the Company had a restricted cash balance of $25,478,939 and $24,978,312, respectively, which represents amounts set aside as impounds for future property tax payments, property insurance payments and tenant improvement payments as required by agreements with the Company’s lenders.

Deferred Financing Costs

The Company capitalizes deferred financing costs such as commitment fees, legal fees and other third party costs associated with obtaining commitments for financing that result in a closing of such financing. The Company amortizes these costs over the terms of the respective financing agreements using the effective interest method. The Company expenses unamortized deferred financing costs when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs to the refinanced debt. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close.

Derivative Financial Instruments

The Company’s objective in using derivatives is to add stability to interest expense and to manage the Company’s exposure to interest rate movements or other identified risks. To accomplish these objectives, the Company may use various types of derivative instruments to manage fluctuations in cash flows resulting from interest rate risk attributable to changes in the benchmark interest rate of LIBOR or other applicable benchmark rates.

The Company measures its derivative instruments and hedging activities at fair value and records them as an asset or liability, depending on its rights or obligations under the applicable derivative contract. For derivatives designated as fair value hedges, the changes in the fair value of both the derivative instrument and the hedged items are recorded in earnings. Derivatives used to hedge the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. For derivatives designated as cash flow hedges, the effective portions of changes in fair value of the derivatives are reported in other comprehensive income (loss) and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as hedges and ineffective portions of hedges are recognized in earnings in the affected period. The Company assesses the effectiveness of each hedging relationship by comparing the changes in fair value or cash flows of the derivative hedging instrument with the changes in fair value or cash flows of the designated hedged item or transaction.

As of December 31, 2014, the Company did not have any derivatives designated as cash flow or fair value hedges, nor are derivatives being used for trading or speculative purposes.

F-12

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Fair Value Measurements

Under GAAP, the Company is required to measure certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other assets and liabilities at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories:

• Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

• Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable.

When available, the Company utilizes quoted market prices from an independent third-party source to determine fair value and will classify such items in Level 1 or Level 2. In instances where the market is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and will establish a fair value by assigning weights to the various valuation sources.

The following describes the valuation methodologies used by the Company to measure fair value, including an indication of the level in the fair value hierarchy in which each asset or liability is generally classified.

Interest rate caps - The Company has entered into certain interest rate cap agreements. These derivatives did not qualify as fair value hedges. Fair value was based on a model-driven valuation using the associated variable rate curve and an implied market volatility, both of which were observable at commonly quoted intervals for the full term of the caps. Therefore, the Company’s interest rate caps were classified within Level 2 of the fair value hierarchy.

The following table reflects the Company’s assets required to be measured at fair value on a recurring basis on the consolidated balance sheets:

	December 31, 2014
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate caps	$	—	$	1,978,939	$	—

Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument.

F-13

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Fair Value of Financial Instruments

The accompanying consolidated balance sheets include the following financial instruments: cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities, due to affiliates and notes payable.

The Company considers the carrying value of cash and cash equivalents, restricted cash, rents and other receivables and accounts payable and accrued liabilities and the revolving credit facility to approximate the fair value of these financial instruments based on the short duration between origination of the instruments and their expected realization. The fair value of amounts due to affiliates is not determinable due to the related party nature of such amounts.

The fair value of the mortgage notes payable is estimated using a discounted cash flow analysis using borrowing rates available to the Company for debt instruments with similar terms and maturities. As of December 31, 2014 and 2013, the fair value of the mortgage notes payable was $1,082,414,832 and $965,681,419, respectively, compared to the carrying value of $1,070,757,025 and $987,329,800, respectively. The Company has determined that its notes payable are classified as Level 3 within the fair value hierarchy.

Accounting for Stock-Based Compensation

The Company amortizes the fair value of stock-based compensation awards to expense over the vesting period and records any dividend equivalents earned as dividends for financial reporting purposes. Stock-based compensation awards are valued at the fair value on the date of grant and amortized as an expense over the vesting period.

Distribution Policy

The Company has elected to be taxed as a REIT and to operate as a REIT beginning with its taxable year ended December 31, 2010. To maintain its qualification as a REIT, the Company intends to make distributions each taxable year equal to at least 90% of its REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). For the period from January 1, 2012 to September 9, 2012, distributions were based on daily record dates and calculated at a rate of $0.001917 per share per day and $0.001964 per share per day beginning September 10, 2012. Each day during the period from January 1, 2014 through December 31, 2014 was a record date for distributions.

Distributions to stockholders are determined by the board of directors of the Company and are dependent upon a number of factors relating to the Company, including funds available for the payment of distributions, financial condition, the timing of property acquisitions, capital expenditure requirements and annual distribution requirements in order for the Company to qualify as a REIT under the Internal Revenue Code.

Organization and Offering Costs

Organization and offering expenses include all expenses (other than sales commissions and related dealer manager fees) to be paid by the Company in connection with the Public Offering and the Private Offering, including legal, accounting, printing, mailing and filing fees, charges of the Company’s transfer agent, expenses of organizing the Company, data processing fees, advertising and sales literature costs, transfer agent costs, bona fide out-of-pocket due diligence costs and amounts to reimburse the Advisor or its affiliates for the salaries of its employees and other costs in connection with preparing supplemental sales materials and providing other administrative services.

The Company may also reimburse costs of bona fide training and education meetings held by the Company (primarily travel, meal and lodging costs of registered representatives of broker-dealers), attendance and sponsorship fees and cost reimbursement of employees of the Company’s affiliates to attend seminars conducted by broker-dealers and, in certain cases, reimbursement to participating broker-dealers for technology costs associated with the Public Offering, costs and expenses related to such technology costs, and costs and expenses associated with the facilitation of the marketing of the Company’s shares of common stock and the ownership of the Company’s shares of common stock by such broker-dealers’ customers; provided, however, that the Company will not pay any of the foregoing costs to the extent that such payment would cause total underwriting compensation for the Public Offering to exceed 10% of the gross proceeds of the Public Offering, as required by the rules of the Financial Industry Regulatory Authority, Inc. (“FINRA”).

F-14

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Pursuant to the Advisory Agreement and the dealer manager agreement by and among the Company, the Operating Partnership and the Dealer Manager (the “Dealer Manager Agreement”), the Company was obligated to reimburse the Advisor, the Dealer Manager, or their affiliates, as applicable, for organization and offering costs paid by them on behalf of the Company, provided that, within 60 days of the end of the month in which the Public Offering terminated, the Advisor was obligated to reimburse the Company to the extent selling commissions, dealer manager fees and organization and offering costs incurred by the Company in the completed Public Offering exceeded 15% of gross offering proceeds of the completed Public Offering. Any reimbursement of expenses paid to the Advisor will not exceed actual expenses incurred by the Advisor. No amounts were owed to the Company by the Advisor pursuant to the Advisory Agreement.

Reimbursements to the Advisor, the Dealer Manager, or their affiliates for offering costs paid by them on behalf of the Company with respect to the Private Offering were not limited to 15% of the gross offering proceeds of the Private Offering. However, the Company had previously deferred the reimbursements of offering costs in excess of 15% of the gross offering proceeds of the Private Offering until approval was obtained from the Company’s independent directors. On November 19, 2013, the independent directors approved the reimbursement of such excess costs from the Private Offering. Accordingly, during the year ended December 31, 2013, the Company reimbursed the Advisor $1,425,070 of previously deferred organization and offering costs of the Private Offering in excess of 15% of the gross offering proceeds raised in the Private Offering.

Operating Expenses

Pursuant to the Advisory Agreement, the Company is limited in the amount of certain operating expenses it may record on a rolling four-quarter basis to the greater of 2% of average invested assets and 25% of net income. Operating expenses include all costs and expenses incurred by the Company, as determined under GAAP, that in any way are related to the operation of the Company, excluding expenses of raising capital, interest payments, taxes, property operating expenses, non-cash expenditures, incentive fees, acquisition fees and expenses and investment management fees. During the four quarters ended December 31, 2014, the Company recorded operating expenses of $980,192, which is included in general and administrative expenses in the accompanying consolidated statement of operations. Operating expenses of $72,253 remain payable and are included in due to affiliates in the accompanying consolidated balance sheet as of December 31, 2014.

Income Taxes

The Company has elected to be taxed as a REIT under the Internal Revenue Code beginning with the tax year ended December 31, 2010. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including the requirement to distribute at least 90% of the Company’s annual REIT taxable income to stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, the Company generally will not be subject to federal income tax to the extent it distributes qualifying dividends to its stockholders. If the Company fails to qualify as a REIT in any taxable year after the taxable year in which the Company initially elects to be taxed as a REIT, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially adversely affect the Company’s net income and net cash available for distribution to stockholders. However, the Company believes it is organized and operates in such a manner as to qualify for treatment as a REIT.

The Company follows the Income Taxes Topic of the ASC to recognize, measure, present and disclose in its accompanying consolidated financial statements uncertain tax positions that the Company has taken or expects to take on a tax return. As of December 31, 2014 and 2013, the Company had no liabilities for uncertain tax positions that it believes should be recognized in its accompanying consolidated financial statements. Due to uncertainty regarding the realization of certain deferred tax assets, the Company has established valuation allowances, primarily in connection with the net operating loss carryforward related to the REIT. The Company has not been assessed interest or penalties by any major tax jurisdictions. The Company’s evaluation was performed for the tax years ended December 31, 2014 and 2013. As of December 31, 2014, the Company’s tax returns for calendar years 2013, 2012 and 2011 remain subject to examination by major tax jurisdictions.

F-15

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Per Share Data

Basic earnings (loss) per share attributable for all periods presented are computed by dividing net income (loss) attributable to controlling interest by the weighted average number of shares of the Company’s common stock outstanding during the period. Diluted earnings (loss) per share are computed based on the weighted average number of shares of the Company’s common stock and all potentially dilutive securities, if any. Distributions declared per common share assumes each share was issued and outstanding each day during the period. The Company's unvested restricted common stock contain non-forfeitable rights to dividends and are considered to be participating securities in accordance with GAAP and, therefore, are included in the computation of earnings (loss) per share under the two-class method. Under the two-class method, net losses are not allocated to participating securities unless the holder of the security has a contractual obligation to share in the losses. The unvested restricted common stock are not allocated losses as the awards do not have a contractual obligation to share in the losses of the Company. The two-class method is an earnings (loss) allocation formula that determines earnings (loss) per share for each class of common shares and participating securities according to dividends declared and participation rights in undistributed earnings.

Segment Disclosure

The Company has determined that it has one reportable segment with activities related to investing in multifamily properties. The Company’s investments in real estate are in different geographic regions, and management evaluates operating performance on an individual asset level. However, as each of the Company’s assets has similar economic characteristics, tenants and products and services, its assets have been aggregated into one reportable segment.

Recent Accounting Pronouncements

In April 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, that limits discontinued operations reporting to disposals of components of an entity that represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when any of the following occurs: (a) the component of an entity or group of components of an entity meets the criteria to be classified as held for sale; (b) the component of an entity or group of components of an entity is disposed of by sale; or (c) the component of an entity or group of components of an entity is disposed of other than by sale. This guidance also requires additional disclosures about discontinued operations and is effective for reporting periods beginning after December 15, 2014. Early adoption is permitted, but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued or available for issuance. The Company early adopted the new guidance for the reporting period beginning January 1, 2014. As a result of the adoption of this guidance, properties that are classified as held for sale in the ordinary course of business on or subsequent to January 1, 2014 would generally be included in continuing operations on the Company’s consolidated statements of operations to the extent such disposals did not meet the criteria for classification as a discontinued operation described above. Additionally, any gain or loss on the sale of real estate that does not meet the criteria for classification as a discontinued operation would be presented on the consolidated statements of operations below income from continuing operations and income from discontinued operations.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, a comprehensive new revenue recognition standard that will supersede existing revenue guidance under GAAP. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under today’s guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The guidance is effective for public business entities for annual periods beginning after December 15, 2016, including interim periods within that period. Early adoption is not permitted under GAAP. The Company does not expect there to be a material impact from adopting this new guidance.

F-16

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

In June 2014, the FASB issued ASU 2014-15, Accounting for Share-Based Payments When the Terms of an Award Provide that a Performance Target Could be Achieved After the Requisite Service Period, that requires an entity to treat performance targets that can be met after the requisite service period of a share based award has ended, as a performance condition that affects vesting. The new guidance is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2015. The Company does not expect there to be a material impact from adopting this new guidance.

In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, that requires management to evaluate whether there are conditions and events that raise substantial doubt about an entity’s ability to continue as a going concern. Until now, the requirement to perform a going concern evaluation existed only in auditing standards. The new guidance requires management to evaluate relevant conditions, events and certain management plans that are known or reasonably knowable as of the evaluation date when determining whether substantial doubt about an entity’s ability to continue as a going concern exists. Management will be required to make this evaluation for both annual and interim reporting periods. The standard states substantial doubt about an entity’s ability to continue as a going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. The guidance is effective for annual periods ending after December 15, 2016 and for annual periods and interim periods thereafter. Early adoption is permitted. The Company does not expect there to be a material impact from adopting this new guidance.

In January 2015, the FASB issued ASU 2015-01, Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items, that eliminates the concept of the extraordinary items from GAAP. The objective of the new guidance is to simplify the income statement presentation requirements of GAAP. Eliminating the extraordinary classification simplifies income statement presentation by altogether removing the concept of extraordinary items from consideration. The guidance is effective for annual periods, including interim periods within that period, beginning after December 15, 2015. Early adoption is permitted. The Company does not expect there to be a material impact from adopting this new guidance.

3. Real Estate

As of December 31, 2014, the Company owned 65 multifamily properties, encompassing in the aggregate 16,526 apartment homes and 25,973 square feet of rentable commercial space. The total cost of the Company’s real estate portfolio was $1,624,892,557. As of December 31, 2014 and 2013, the Company’s portfolio was approximately 94.1% and 92.4% occupied and the average monthly rent was $966 and $897, respectively.

F-17

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Current Year Acquisitions

During the year ended December 31, 2014, the Company acquired the following properties:

				Purchase Price Allocation
Property Name	Location	Purchase Date	Units	Land		Building and Improvements		Tenant Origination and Absorption Costs		Total Purchase Price
Sycamore Terrace Apartments (Phase II)	Terre Haute, IN	3/5/2014	72	$	381,657	$	6,190,931	$	101,569	$	6,674,157
Reserve at Creekside Village	Chattanooga, TN	3/28/2014	192	1,344,233		17,178,743		352,024		18,875,000
Mapleshade Park	Dallas, TX	3/31/2014	148	3,585,171		19,131,230		608,599		23,325,000
Richland Falls	Murfreesboro, TN	5/16/2014	190	1,306,794		19,422,561		270,645		21,000,000
Oak Crossing	Fort Wayne, IN	6/3/2014	222	2,005,491		21,808,038		416,471		24,230,000
Park Shore	St. Charles, IL	9/12/2014	160	1,619,712		16,221,717		508,571		18,350,000
Tapestry Park Apartments (Phase II)	Birmingham, AL	12/1/2014	131	1,433,853		16,435,006		16,141		17,885,000
			1,115	$	11,676,911	$	116,388,226	$	2,274,020	$	130,339,157

As of December 31, 2014 and 2013, accumulated depreciation and amortization related to the Company’s consolidated real estate properties and related intangibles were as follows:

	December 31, 2014
	Assets																		Liabilities
	Land		Building and Improvements			Tenant Origination and Absorption			Other Intangible Assets			Construction-in-Progress		Total Real Estate Held for Investment			Real Estate Held for Sale		Below-Market Leases
Investments in real estate	$	174,102,422	$	1,457,633,918		$	524,712		$	2,644,263		$	2,048,098	$	1,636,953,413		$	—	$	—
Less: Accumulated depreciation and amortization	—		(97,793,830		)	(308,926		)	(239,696		)	—		(98,342,452		)	—		—
Net investments in real estate and related lease intangibles	$	174,102,422	$	1,359,840,088		$	215,786		$	2,404,567		$	2,048,098	$	1,538,610,961		$	—	$	—

F-18

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

	December 31, 2013
	Assets																			Liabilities
	Land		Building and Improvements			Tenant Origination and Absorption			Other Intangible Assets			Construction-in-Progress		Total Real Estate Held for Investment			Real Estate Held for Sale			Below-Market Leases
Investments in real estate	$	162,425,511	$	1,316,608,491		$	15,588,747		$	2,644,263		$	—	$	1,497,267,012		$	22,616,466		$	(1,410,728	)
Less: Accumulated depreciation and amortization	—		(39,156,143		)	(7,133,844		)	(86,528		)	—		(46,376,515		)	(2,543,804		)	1,247,491
Net investments in real estate and related lease intangibles	$	162,425,511	$	1,277,452,348		$	8,454,903		$	2,557,735		$	—	$	1,450,890,497		$	20,072,662		$	(163,237	)

Depreciation and amortization expense was $69,681,177, $48,454,178 and $14,957,857 for the years ended December 31, 2014, 2013 and 2012, respectively.

Depreciation of the Company’s buildings and improvements was $59,014,085, $32,103,974 and $8,214,839 for the years ended December 31, 2014, 2013 and 2012, respectively.

Amortization of the Company’s tenant origination and absorption costs was $10,513,924, $16,263,677 and $6,743,018 for the years ended December 31, 2014, 2013 and 2012, respectively. Tenant origination and absorption costs had a weighted-average amortization period as of the date of acquisition of less than one year.

Amortization of the Company’s other intangible assets was $153,168, $86,528 and $0 for the years ended December 31, 2014, 2013 and 2012, respectively. Other intangible assets had a weighted-average amortization period as of the date of acquisition of 18.17 years.

The increase in rental income as a result of the accretion of the Company’s below-market lease intangible liabilities for the years ended December 31, 2014, 2013 and 2012 was $163,237, $1,108,789 and $138,703, respectively. The Company’s below-market lease intangible liabilities had a weighted-average accretion period as of the date of acquisition of less than one year.

The future amortization of the Company’s acquired other intangible assets as of December 31, 2014 and thereafter is as follows:

2015	$	153,168
2016	153,168
2017	153,168
2018	153,168
2019	153,168
Thereafter	1,638,728
	$	2,404,568

Operating Leases

As of December 31, 2014, the Company’s real estate portfolio comprised 16,526 residential apartment homes and was 96.6% leased by a diverse group of residents. For the years ended December 31, 2014 and 2013, the Company’s real estate portfolio earned approximately 99% and 1% of its rental income from residential tenants and commercial office tenants, respectively. The residential tenant lease terms consist of lease durations equal to 12 months or less. The commercial office tenant leases consist of lease durations varying from 3.16 to 6.79 years.

F-19

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Some residential and commercial leases contain provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires security deposits from tenants in the form of a cash deposit and/or a letter of credit for commercial tenants. Amounts required as security deposits vary depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to tenant leases are included in accounts payables and accrued liabilities in the accompanying consolidated balance sheets and totaled $4,156,797 and $3,560,623 as of December 31, 2014 and 2013, respectively.

The future minimum rental receipts from the Company’s properties under non-cancelable operating leases attributable to commercial office tenants as of December 31, 2014 and thereafter is as follows:

2015	$	347,036
2016	350,051
2017	354,433
2018	202,540
2019	163,431
Thereafter	198,530
	$	1,616,021

As of December 31, 2014 and 2013, no tenant represented over 10% of the Company’s annualized base rent and there were no significant industry concentrations with respect to its commercial leases.

Current Year Property Dispositions

Lincoln Tower Apartments

On August 11, 2010, the Company, through an indirect wholly owned subsidiary, acquired Lincoln Tower Apartments, a multifamily property located in Springfield, Illinois, containing 190 apartment homes and 8,995 rentable square feet of commercial space. The purchase price of the Lincoln Tower Apartments was $9,500,000, plus closing costs. On June 27, 2014, the Company sold the Lincoln Tower Apartments for $15,887,500, resulting in a gain of $7,072,294, which includes reductions to the net book value of the property due to historical depreciation and amortization expense. The purchaser of the Lincoln Tower Apartments was not affiliated with the Company or the Advisor.

Arbor Pointe Apartments

On May 5, 2011, the Company, through an indirect wholly owned subsidiary, acquired Arbor Pointe Apartments, a multifamily property located in Louisville, Kentucky, containing 130 apartment homes. The purchase price of Arbor Pointe Apartments was $6,500,000, plus closing costs. On July 1, 2014, the Company sold Arbor Pointe Apartments for $8,325,000, resulting in a gain of $2,034,244, which includes reductions to the net book value of the property due to historical depreciation and amortization expense. The purchaser of the Arbor Pointe Apartments was not affiliated with the Company or the Advisor.

Prairie Walk Apartments

On December 22, 2011, the Company, through an indirect wholly owned subsidiary, acquired Prairie Walk Apartments, a multifamily property located in Kansas City, Missouri, containing 128 apartment homes. The purchase price of Prairie Walk Apartments was $6,100,000, plus closing costs. On August 6, 2014, the Company sold Prairie Walk Apartments for $6,700,000, resulting in a gain of $837,596, which includes reductions to the net book value of the property due to historical depreciation and amortization expense. The purchaser of the Prairie Walk Apartments was not affiliated with the Company or the Advisor.

F-20

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

The results of operations for the years ended ended December 31, 2014, 2013 and 2012 for the disposed properties were included in continuing operations on the Company’s consolidated statements of operations and are as follows:

	For the year ended December 31,
	2014		2013		2012
Revenues:
Rental income	$	2,196,351	$	4,097,647	$	3,941,695
Tenant reimbursements and other	254,314		378,433		291,214
Total revenues	2,450,665		4,476,080		4,232,909
Expenses:
Operating, maintenance and management	989,164		1,603,413		1,529,382
Real estate taxes and insurance	255,084		495,802		468,067
Fees to affiliates	598,041		195,770		74,723
Depreciation and amortization	377,183		945,409		1,088,693
Interest expense	387,709		758,258		791,173
Loss on debt extinguishment	1,939,817		—		—
Total expenses	$	4,546,998	$	3,998,652	$	3,952,038

4. Deferred Financing Costs and Other Assets

As of December 31, 2014 and 2013, deferred financing costs and other assets, net of accumulated amortization, consisted of:

	December 31, 2014			December 31, 2013
Deferred financing costs	$	9,743,277		$	8,440,169
Less: accumulated amortization	(2,510,317		)	(1,235,886		)
	7,232,960			7,204,283
Prepaid expenses	2,900,609			3,142,924
Interest rate cap agreements (Note 11)	1,978,939			5,462,561
Escrow deposits for pending real estate acquisitions	—			500,000
Other deposits	1,343,098			1,265,642
	$	13,455,606		$	17,575,410

F-21

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

5. Debt

Notes Payable

The following is a summary of notes payable secured by real property as of December 31, 2014 and 2013:

					Principal Outstanding at
	Property Name	Payment Type	Maturity Date	Interest Rate(1)	December 31, 2014		December 31, 2013
1	Lincoln Tower(2)	Principal and interest	May 1, 2019	3.66%	$	—	$	8,434,054
2	Park Place	Interest only	July 1, 2018	3.50%	4,890,069		4,938,136
3	Arbor Pointe(2)	Principal and interest	June 1, 2018	4.86%	—		5,006,199
4	Clarion Park	Principal and interest	July 1, 2018	4.58%	8,479,259		8,632,301
5	Cooper Creek	Principal and interest(3)	September 1, 2018	3.89%	6,500,887		6,624,725
6	Truman Farm Villas	Principal and interest(3)	January 1, 2019	3.78%	5,709,615		5,818,457
7	Prairie Walk(2)	Principal and interest(3)	January 1, 2019	3.74%	—		3,899,807
8	EBT Lofts	Principal and interest(3)	January 1, 2019	3.82%	5,397,291		5,499,432
9	Windsor on the River(4)(5)	Principal and interest(3)	June 1, 2024	1-Mo LIBOR + 2.09%	23,500,000		23,500,000
10	Renaissance St. Andrews	Principal and interest(3)	January 1, 2023	3.85%	8,937,635		9,084,000
11	Spring Creek(6)	Principal and interest	February 1, 2018	4.88%	13,577,868		13,912,669
12	Montclair Parc	Principal and interest	May 1, 2019	3.70%	23,827,037		24,305,671
13	Sonoma Grande	Principal and interest(7)	June 1, 2019	3.31%	22,324,719		22,540,000
14	Estancia(6)	Interest only	October 1, 2017(8)	5.94%	21,485,523		21,844,621
15	Montelena(6)	Principal and interest(9)	August 1, 2018	4.82%	12,290,751		12,614,683
16	Valley Farms	Principal and interest	January 1, 2020	4.25%	10,068,528		10,244,494
17	Hilliard Park	Principal and interest(3)	October 1, 2022	3.62%	13,563,481		13,818,616
18	Hilliard Summit	Principal and interest(3)	October 1, 2022	3.56%	16,436,620		16,749,262
19	Springmarc	Principal and interest(3)	November 1, 2019	3.69%	15,166,129		15,446,452
20	Ashley Oaks(5)	Principal and interest(3)	November 1, 2021	1-Mo LIBOR + 2.35%	21,296,125		21,680,010

F-22

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

					Principal Outstanding at
	Property Name	Payment Type	Maturity Date	Interest Rate(1)	December 31, 2014		December 31, 2013
21	Arrowhead	Principal and interest(3)	December 1, 2019	3.38%	$	12,321,880	$	12,562,000
22	The Moorings	Principal and interest(3)	December 1, 2019	3.37%	14,896,178		15,187,000
23	Forty-57	Principal and interest(10)	January 1, 2023	3.73%	38,500,000		38,500,000
24	Keystone Farms	Principal and interest(3)	January 1, 2023	3.86%	6,100,287		6,200,000
25	Riverford Crossing	Principal and interest(10)	January 1, 2023	3.78%	21,900,000		21,900,000
26	South Pointe(11)	Principal and interest(10)	October 1, 2021	5.00%	1,155,185		—
27	Montecito	Principal and interest(3)	January 1, 2020	3.47%	14,003,890		14,250,000
28	Hilliard Grand	Principal and interest	August 1, 2052	5.59%	28,832,151		29,050,224
29	The Hills at Fair Oaks	Principal and interest(10)	February 1, 2023	4.02%	24,767,000		24,767,000
30	Library Lofts	Principal and Interest	April 1, 2020	3.66%	8,941,943		9,113,640
31	Trails at Buda Ranch(5)	Principal and interest(3)	April 1, 2023	1-Mo LIBOR + 2.42%	16,821,368		17,030,000
32	Deep Deuce at Bricktown Apartments(6)	Principal and interest	April 1, 2018	5.04%	23,902,012		24,603,299
33	Deep Deuce at Bricktown — Supplemental Loan	Principal and interest	April 1, 2018	4.73%	2,737,193		2,779,688
34	Deer Valley(5)	Principal and interest(3)	May 1, 2023	1-Mo LIBOR + 2.40%	20,645,873		20,875,000
35	Grayson Ridge(5)	Principal and interest(3)	July 1, 2020	1-Mo LIBOR + 2.63%	10,631,586		10,725,000
36	Rosemont at Olmos Park(5)	Principal and interest(10)	July 1, 2020	1-Mo LIBOR + 2.65%	14,667,462		15,100,000
37	Retreat at Quail North(6)	Principal and interest	January 1, 2053	4.80%	17,029,692		17,190,827
38	The Lodge at Trails Edge(6)	Principal and interest	November 1, 2020	4.47%	10,744,647		10,965,388
39	The Lodge at Trails Edge — Supplemental Loan	Principal and interest	November 1, 2020	5.75%	1,912,449		1,936,199
40	Arbors of Carrollton(6)	Principal and interest	December 1, 2020	4.83%	5,289,656		5,395,471
41	Arbors of Carrollton — Supplemental Loan	Principal and interest	December 1, 2020	4.83%	971,423		986,624
42	Waterford on the Meadow(6)	Principal and interest	December 1, 2020	4.70%	13,885,425		14,154,991
43	Waterford on the Meadow — Supplemental Loan	Principal and interest	December 1, 2020	4.78%	2,718,243		2,761,194
44	The Belmont(6)	Principal and interest	March 1, 2021	5.91%	9,295,899		9,498,460

F-23

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

					Principal Outstanding at
	Property Name	Payment Type	Maturity Date	Interest Rate(1)	December 31, 2014		December 31, 2013
45	Meritage at Steiner Ranch(5)	Principal and interest(3)	September 1, 2020	1-Mo LIBOR + 2.47%	$	55,198,913	$	55,500,000
46	Tapestry Park(5)(12)	Principal and interest(3)	June 1, 2022	1-Mo LIBOR + 2.44%	34,725,000		23,100,000
47	Dawntree(6)	Principal and interest(13)	August 6, 2021	5.48%	15,833,312		16,022,763
48	Stuart Hall(5)	Principal and interest(3)	September 1, 2020	1-Mo LIBOR + 2.75%	12,350,045		12,407,000
49	BriceGrove Park(5)	Principal and interest(3)	October 1, 2020	1-Mo LIBOR + 2.58%	14,932,281		14,985,000
50	Cantare at Indian Lake Village	Principal and interest(3)	August 1, 2024	1-Mo LIBOR + 1.62%	18,850,000		—
51	Landing at Mansfield(5)	Principal and interest(3)	October 1, 2020	1-Mo LIBOR + 2.69%	22,671,543		22,750,000
52	The Heights(5)	Principal and interest(3)	October 1, 2020	1-Mo LIBOR + 2.60%	28,912,294		29,014,000
53	Villas at Huffmeister(5)	Principal and interest(3)	November 1, 2020	1-Mo LIBOR + 2.68%	25,917,180		25,963,000
54	Villas at Kingwood(5)	Principal and interest(3)	November 1, 2020	1-Mo LIBOR + 2.68%	28,055,400		28,105,000
55	Waterford Place at Riata Ranch(5)	Principal and interest(3)	November 1, 2020	1-Mo LIBOR + 2.64%	16,310,966		16,340,000
56	Carrington Place(5)	Principal and interest(10)	December 1, 2023	1-Mo LIBOR + 2.16%	22,376,000		22,376,000
57	Carrington at Champion Forest(5)	Principal and interest(10)	December 1, 2023	1-Mo LIBOR + 2.16%	22,959,000		22,959,000
58	Carrington Park(5)	Principal and interest(10)	December 1, 2023	1-Mo LIBOR + 2.16%	17,717,000		17,717,000
59	Willow Crossing(5)	Principal and interest(10)	December 1, 2023	1-Mo LIBOR + 2.20%	43,500,000		43,500,000
60	Heritage Grand at Sienna Plantation(6)	Principal and interest	January 1, 2053	4.65%	16,697,112		16,845,443
61	Audubon Park(5)	Principal and interest(10)	January 1, 2024	1-Mo LIBOR + 2.41%	11,760,000		11,760,000
62	Mallard Crossing(5)	Principal and interest(3)	January 1, 2021	1-Mo LIBOR + 2.57%	27,860,000		27,860,000
63	Renaissance at Carol Stream(5)	Principal and interest(3)	February 1, 2021	1-Mo LIBOR + 2.36%	20,440,000		—
64	Mapleshade Park(5)	Principal and interest(14)	April 1, 2021	1-Mo LIBOR + 2.15%	15,161,000		—
65	Richland Falls	Principal and interest(10)	May 16, 2017(8)	Variable(15)	13,800,000		—
66	Oak Crossing(5)	Interest only	July 1, 2024	1-Mo LIBOR + 1.63%	15,762,000		—
67	Park Shore(5)	Interest only	October 1, 2021	1-Mo LIBOR + 1.87%	12,845,000		—
					$	1,070,757,025	$	987,329,800

F-24

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

_______________

(1) Except as otherwise noted, interest on the notes accrues at a fixed rate per annum. At December 31, 2014, the weighted-average interest rate of our fixed rate debt and variable rate debt was 4.30% and 2.53%, respectively. The weighted-average interest rate of our blended fixed and variable rates was 3.36% as of December 31, 2014.

(2) The Lincoln Tower Apartments, Arbor Pointe Apartments, and Prairie Walk Apartments were sold on June 27, 2014, July 1, 2014 and August 6, 2014, respectively, and the mortgage notes payable were repaid in full on the respective date of sale with proceeds from the sale. Upon the early extinguishment of the Lincoln Tower, Arbor Pointe, and Prairie Walk mortgage notes payable, a loss on debt extinguishment of $891,885, $676,888, and $371,044, respectively, was recorded on the consolidated statements of operations, including a prepayment penalty of $796,227, $649,825 and $347,949, respectively, and an expense of the net deferred financing costs of $95,658, $27,063 and $23,095, respectively.

(3) A monthly payment of interest only is due and payable for twelve months from the loan date, after which, a monthly payment of principal and interest is due and payable until the maturity date.

(4) On May 9, 2014, the Company refinanced the existing mortgage loan secured by the Windsor on the River property with the proceeds of a new mortgage loan in the aggregate principal amount of $23,500,000. The proceeds from the new loan were used to redeem the assumed obligations for tax exempt bonds issued by the Iowa Finance Authority in the amount of $23,500,000. In connection with the refinancing, the Company’s obligations under the existing letter of credit were terminated.

(5) See Note 11 for a discussion of the interest rate cap agreements used to manage the exposure to interest rate movement on the Company’s variable rate loans.

(6) The following table summarizes the debt premiums and discounts as of December 31, 2014, including the unamortized portion included in the principal balance as well as amounts amortized as an offset to interest expense in the accompanying consolidated statements of operations:

Property Name	Unamortized Portion of Debt Premium (Discount) as of December 31, 2014			Amortization of Debt Premium (Discount) During the Year Ended December 31,
				2014			2013			2012
Spring Creek	$	313,649		$	101,429		$	101,428		$	82,342
Estancia	985,523			359,097			359,096			181,544
Montelena	525,060			146,368			146,368			68,462
Deep Deuce at Bricktown	1,020,989			315,193			239,784			—
Retreat at Quail North	457,934			12,034			6,385			—
The Lodge at Trails Edge	93,162			15,872			8,686			—
Arbors of Carrollton	147,552			24,938			12,469			—
Waterford on the Meadow	298,483			50,448			25,224			—
The Belmont	579,533			94,225			40,780			—
Dawntree	713,778			126,985			48,131			—
Heritage Grand at Sienna Plantation	(448,865		)	(11,796		)	(381		)	—
	$	4,686,798		$	1,234,793		$	987,970		$	332,348

(7) A monthly payment of interest only was due and payable through June 1, 2014, after which, a monthly payment of principal and interest is due and payable until the maturity date.

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

(8) The Company has the option to extend the maturity date for 12 months from the original maturity date, subject to customary and market rate extension provisions.

(9) A monthly payment of interest only was due and payable through August 1, 2013, after which, a monthly payment of principal and interest is due and payable until the maturity date.

(10) A monthly payment of interest only is due and payable for 24 months from the loan date, after which, a monthly payment of principal and interest is due and payable until the maturity date.

(11) On September 11, 2014, the Company obtained a loan from Farmers & Merchants Bank of Long Beach in an amount up to a maximum principal balance of $9,720,000 to finance a portion of the development and construction of an additional 96 apartment units at the Southpointe Property, which was acquired by the Company on December 28, 2012.

(12) On December 1, 2014, the Company acquired Tapestry Park Apartments (Phase II) for a total purchase price of $17,885,000. The Company’s strategy is to operate and manage Tapestry Park Apartments and Tapestry Park Apartments (Phase II) as a single property. In conjunction with the Tapestry Park Apartments (Phase II) acquisition, the Company’s existing mortgage loan secured by Tapestry Park Apartments in the amount of $23,100,000 was repaid in full and replaced with a new mortgage loan in the aggregate principal amount of $34,725,000. The same lender originated the mortgage loans for the existing and new loans. The Company accounted for this transaction as a debt modification, in accordance with GAAP.

(13) A monthly payment of interest only is due and payable through August 6, 2014, after which, a monthly payment of principal and interest is due and payable until the maturity date.

(14) A monthly payment of interest only is due and payable for 36 months from the loan date, after which, a monthly payment of principal and interest is due and payable until the maturity date.

(15) The Company has the option to select the interest rate at the end of each LIBOR interest period (as defined in the note agreement) from the following options: (1) 0.85% plus the highest of (A) the Prime Rate (as defined in the note agreement), (B) the sum of the Federal Funds Rate (as defined in the note agreement) plus 0.50%, and (C) daily LIBOR plus 1.0% (the “Base Rate Option”) or (2) LIBOR plus 1.85% (the “LIBOR Option”). If the LIBOR Option is selected by the Company, the Company may select either the one-month LIBOR, three-month LIBOR or six-month LIBOR. The margin rate under each option may be reduced by 20 basis points if the property achieves occupancy in excess of 90% for 90 consecutive days. As of December 31, 2014, the Company had elected the LIBOR Option using one-month LIBOR.

Revolving Credit Facility

The Company entered into a revolving line of credit pursuant to a Loan Agreement with PNC Bank, N.A. (“PNC Bank”) to borrow up to $20,000,000. Each advance under the facility is due within 180 days from the date of the advance. On July 18, 2014, the Company and PNC Bank amended the Loan Agreement to, among other things, increase the potential borrowing limit from $20,000,000 to $35,000,000. The amended and restated credit facility consists of a Tranche A and a Tranche B, and provides certain security for borrowings under the credit facility. The maximum amount that may be borrowed under Tranche A and Tranche B are $20,000,000 and $15,000,000, respectively. The amended and restated credit facility has a maturity date of July 17, 2016, subject to extension.

For each advance, the Company had the option to select the interest rate from the following options: (1) 2.0% plus the highest of (A) the Prime Rate (as defined in the Loan Agreement), (B) the sum of the Federal Funds Rate (as defined in the Loan Agreement) plus 0.5%, and (C) daily LIBOR plus 1.0% or (2) LIBOR plus 3.0%. For each advance wherein one of the LIBOR options was selected by the Company, the Company could select either the one-month LIBOR, three-month LIBOR or six-month LIBOR. For each advance under the amended and restated credit facility, the Company has the option to select the interest rate from the following options: (1) Base Rate Option (as defined in the Loan Agreement) plus (i) with respect to Tranche A, 0.75% and (ii) with respect to Tranche B, 2.0%; or (2) LIBOR Option, which is a rate per annum fixed for the

F-26

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

LIBOR Interest Period (as defined in the Loan Agreement) equal to the sum of LIBOR plus (i) with respect to Tranche A, 1.6% and (ii) with respect to Tranche B, 3.0%. The Company elected the LIBOR Option and the in-place interest rate was 1.77% as of December 31, 2014.

As of December 31, 2014 and 2013, $14,000,000 and $0 was outstanding under the credit facility, respectively.

The following is a summary of the Company’s aggregate maturities as of December 31, 2014:

			Maturities During the Years Ending December 31,
Contractual Obligation	Total		2015		2016		2017		2018		2019		Thereafter
Principal payments on outstanding debt obligations(1)	$	1,080,070,227	$	14,106,234	$	29,835,302	$	51,817,023	$	83,280,961	$	127,507,710	$	773,522,997

________________

(1) Projected principal payments on outstanding debt obligations are based on the terms of the notes payable agreements. Amounts exclude the amortization of the debt premiums associated with certain notes payable.

The Company’s notes payable contain customary financial and non-financial debt covenants. As of December 31, 2014 and 2013, the Company was in compliance with all financial and non-financial debt covenants.

For the years ended December 31, 2014, 2013 and 2012, the Company incurred interest expense of $40,412,744, $24,308,402 and $6,291,193, respectively. Interest expense for the years ended December 31, 2014, 2013 and 2012 includes amortization of deferred financing costs of $1,489,834, $976,198 and $225,614, amortization of loan premiums and discounts of $1,234,793, $987,970 and $332,348, net unrealized loss from the change in fair value of interest rate caps of $4,353,301, $448,984 and $162,761, and capitalized interest of $41,898, $0 and $0, respectively. Interest expense of $2,870,380 and $2,539,966 was payable as of December 31, 2014 and 2013, respectively, and is included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets.

6. Stockholders’ Equity

General

Under the Company’s Third Articles of Amendment and Restatement (the “Charter”), the total number of shares of capital stock authorized for issuance is 1,100,000,000 shares, consisting of 999,999,000 shares of common stock with a par value of $0.01 per share, 1,000 shares of convertible stock with a par value of $0.01 per share and 100,000,000 shares designated as preferred stock with a par value of $0.01 per share.

Common Stock

The shares of the Company’s common stock entitle the holders to one vote per share on all matters upon which stockholders are entitled to vote, to receive dividends and other distributions as authorized by the Company’s board of directors in accordance with the Maryland General Corporation Law and to all rights of a stockholder pursuant to the Maryland General Corporation Law. The common stock has no preferences or preemptive, conversion or exchange rights.

During 2009, the Company issued 22,223 shares of common stock to the Sponsor for $200,007. From inception through December 31, 2014, the Company had issued 76,732,387 shares of common stock in its Private Offering and Public Offering for offering proceeds of $679,572,142, net of offering costs of $95,845,468, including 4,073,751 shares of common stock pursuant to the DRP, for total proceeds of $39,580,769. Offering costs primarily consist of selling commissions and dealer manager fees. Offering proceeds include $0 and $26,549,087 of amounts receivable from the Company’s transfer agent as of December 31, 2014 and 2013, respectively, which are included in rents and other receivables in the accompanying consolidated balance sheets. The Company terminated its Public Offering on December 20, 2013, but continued to offer shares pursuant to the DRP through November 30, 2014.

F-27

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

The activity for the years ended December 31, 2014, 2013 and 2012 for the restricted stock issued to the Company’s independent directors as compensation for services in connection with their initial election or re-election to the board of directors at the Company’s annual meeting is as follows:

	2014		2013		2012
Nonvested shares at the beginning of the year	18,750		20,625		12,500
Granted shares	10,000		10,000		17,500
Vested shares	(11,875	)	(11,875	)	(9,375	)
Nonvested shares at the end of the year	16,875		18,750		20,625

Additionally, the weighted average fair value of restricted stock issued to the Company’s independent directors for the years ended December 31, 2014, 2013 and 2012 is as follows:

Grant Year	Weighted Average Fair Value
2012	$	9.23
2013	10.24
2014	10.24

The shares of restricted common stock vest and become non-forfeitable in four equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant and will become fully vested and become non-forfeitable on the earlier to occur of (1) the termination of the independent director’s service as a director due to his or her death or disability, or (2) a change in control of the Company.

Included in general and administrative expenses is $118,145, $105,210 and $94,425 for the years ended December 31, 2014, 2013 and 2012, respectively, for compensation expense related to the issuance of restricted common stock. The weighted average remaining vesting term of the restricted common stock is 1.44 years as of December 31, 2014.

On November 15, 2012, the Company entered into a Stock Purchase Plan (the “Plan”) with Ella S. Neyland, the Company’s President and a member of the Company’s board of directors, whereby Ms. Neyland agreed to invest $5,530 for 600 shares of common stock pursuant to the Company’s Public Offering on the first day of each fiscal quarter. The shares were purchased pursuant to the Plan at a price of $9.22 per share, reflecting the elimination of selling commissions and the dealer manager fee in connection with such sales.The Plan terminated on November 15, 2013. As of December 31, 2014, Ms. Neyland had cumulatively purchased 2,400 shares for $22,118 pursuant to the Plan.

On June 11, 2014, the Company entered into a restricted stock agreement with the Advisor whereby the Company issued to the Advisor 488,281.25 restricted shares of the Company’s common stock at a fair market value of $10.24 per share in satisfaction of certain deferred fees due to the Advisor in the aggregate amount of $5,000,000. The shares of restricted stock vest and become non-forfeitable upon the earliest to occur of (i) 50% at December 31, 2015 and 50% at December 31, 2016, (ii) certain liquidity events of the Company, (iii) the Company’s cumulative modified funds from operations exceed the lesser of (a) the cumulative amount of distributions paid to the Company’s stockholders or (b) an amount that is equal to a 7.0% cumulative, non-compounded annual return on the Company’s stockholders’ invested capital, or (iv) the Company’s termination of, or failure to renew, the Advisory Agreement other than for “cause” (as defined in the Advisory Agreement). The shares of restricted stock shall be forfeited if the Advisor is terminated for any reason other than (iv) above. The fair value of the shares of restricted stock was $5,000,000 as of December 31, 2014.

F-28

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Convertible Stock

The Company issued 1,000 shares of Convertible Stock to the Advisor for $1,000. The Convertible Stock will convert into shares of the Company’s common stock if and when: (A) the Company has made total distributions on the then outstanding shares of common stock equal to the original issue price of those shares plus an 8.0% cumulative, non-compounded, annual return on the original issue price of those shares, (B) subject to specified conditions, the Company lists the common stock for trading on a national securities exchange or (C) the Advisory Agreement is terminated or not renewed by the Company (other than for “cause” as defined in the Advisory Agreement). A “listing” will also be deemed to have occurred on the effective date of any merger of the Company in which the consideration received by the holders of the Company’s common stock is the securities of another issuer that are listed on a national securities exchange. Upon conversion, each share of Convertible Stock will convert into a number of shares of common stock equal to 1/1000 of the quotient of (A) 10% of the amount, if any, by which (1) the Company’s “enterprise value” (as defined in the Charter) plus the aggregate value of distributions paid to date on the outstanding shares of common stock exceeds (2) the aggregate purchase price paid by the stockholders for those shares plus an 8.0% cumulative, non-compounded, annual return on the original issue price of those shares, divided by (B) the Company’s enterprise value divided by the number of outstanding shares of common stock, in each case calculated as of the date of the conversion. In the event of a termination or non-renewal of the Advisory Agreement by the Company for cause, the Convertible Stock will be redeemed by the Company for $1.00.

Preferred Stock

The Charter also provides the Company’s board of directors with the authority to issue one or more classes or series of preferred stock, and prior to the issuance of such shares of preferred stock, the board of directors shall have the power from time to time to classify or reclassify, in one or more series, any unissued shares and designate the preferences, rights and privileges of such shares of preferred stock. The Company’s board of directors is authorized to amend the Charter, without the approval of the stockholders, to increase the aggregate number of authorized shares of capital stock or the number of shares of any class or series that the Company has authority to issue. As of December 31, 2014 and 2013, no shares of the Company’s preferred stock were issued and outstanding.

Distribution Reinvestment Plan

The Company’s board of directors had approved the DRP through which common stockholders could elect to reinvest an amount equal to the distributions declared on their shares of common stock in additional shares of the Company’s common stock in lieu of receiving cash distributions. The initial purchase price per share under the DRP was $9.50. Effective September 10, 2012, shares of the Company’s common stock are issued pursuant to the DRP at a price of $9.73 per share. Effective with distributions earned beginning on December 1, 2014, the Company’s board of directors elected to suspend the DRP. As a result, all distributions will be paid in cash and not reinvested in shares of the Company’s common stock. The Company’s board of directors may, in its sole discretion, from time to time, reinstate the DRP, although there is no assurance as to if or when this will happen, change this price based upon changes in the Company’s estimated value per share and other factors that the Company’s board of directors deems relevant.

No sales commissions or dealer manager fees are payable on shares sold through the DRP.

Our distribution reinvestment plan was suspended by our board of directors effective November 20, 2014.

Share Repurchase Plan and Redeemable Common Stock

The Company’s repurchase plan may provide an opportunity for stockholders to have their shares of common stock repurchased by the Company, subject to certain restrictions and limitations. No shares can be repurchased under the Company’s share repurchase plan until after the first anniversary of the date of purchase of such shares; provided, however, that this holding period shall not apply to repurchases requested within two years after the death or disability of a stockholder.

F-29

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

The purchase price for shares repurchased under the Company’s share repurchase plan will be as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of Estimated Value per Share(2)
2 years	95.0% of Estimated Value per Share(2)
3 years	97.5% of Estimated Value per Share(2)
4 years	100.0% of Estimated Value per Share(2)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

________________

(1) As adjusted for any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares of common stock.

(2) For purposes of the share repurchase plan, the “Estimated Value per Share” will equal the most recently determined Estimated Value per Share when the share repurchase plan is in effect.

(3) The required one year holding period to be eligible to redeem shares under the Company’s share repurchase plan does not apply in the event of death or disability of a stockholder.

(4) The purchase price per share for shares redeemed upon the death or disability of a stockholder will be equal to the average issue price per share for all of the stockholder’s shares.

The purchase price per share for shares repurchased pursuant to the share repurchase plan were further reduced by the aggregate amount of net proceeds per share, if any, distributed to the Company’s stockholders prior to the repurchase date as a result of the sale of one or more of the Company’s assets that constitutes a return of capital distribution as a result of such sales.

Repurchases of shares of the Company’s common stock were made quarterly upon written request to the Company at least 15 days prior to the end of the applicable quarter. Repurchase requests were honored approximately 30 days following the end of the applicable quarter (the “Repurchase Date”). Stockholders could withdraw their repurchase request at any time up to three business days prior the Repurchase Date. During the year ended December 31, 2014, the Company redeemed a total of 280,185 shares with a total redemption value of $2,723,947 and received requests for the redemption of 215,685 shares with a total redemption value of $2,110,525. During the year ended December 31, 2013, the Company redeemed a total of 129,239 shares with a total redemption value of $1,246,300 and received requests for the redemption of 154,518 shares with a total redemption value of $1,466,812.

The Company could not guarantee that the funds set aside for the share repurchase plan would be sufficient to accommodate all repurchase requests made in any quarter. In the event that the Company did not have sufficient funds available to repurchase all of the shares of the Company’s common stock for which repurchase requests had been submitted in any quarter, priority was given to redemption requests in the case of the death or disability of a stockholder. If the Company repurchased less than all of the shares subject to a repurchase request in any quarter, with respect to any shares which had not been repurchased, the requesting stockholder could (1) withdraw the request for repurchase or (2) ask that the Company honor the request in a future quarter, if any, when such repurchases could be made pursuant to the limitations of the share repurchase plan and when sufficient funds were available. Such pending requests would be honored among all requests for redemptions in any given redemption period as follows: first, pro rata as to redemptions sought upon a stockholder’s death or disability; and, next, pro rata as to other redemption requests.

The Company was not obligated to repurchase shares of the Company’s common stock under the share repurchase plan. In no event would redemptions under the share repurchase plan exceed 5% of the weighted average number of shares of the Company’s common stock outstanding during the prior calendar year. There was no fee in connection with a repurchase of shares of the Company’s common stock.

F-30

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

The aggregate amount of repurchases under the Company’s share repurchase plan was not expected to exceed the aggregate proceeds received from the sale of shares pursuant to the DRP. However, if this amount was not sufficient to fund repurchase requests, subject to the 5% limitation outlined above, the Company’s board of directors could, in its sole discretion, choose to use other sources of funds to repurchase shares of the Company’s common stock. Such sources of funds could include cash on hand, cash available from borrowings and cash from liquidations of securities investments as of the end of the applicable month, to the extent that such funds were not otherwise dedicated to a particular use, such as working capital, cash distributions to stockholders or purchases of real estate assets.

In addition, the Company’s board of directors may, in its sole discretion, amend, suspend, or terminate the share repurchase plan at any time upon 30 days notice to the Company’s stockholders if it determines that the funds available to fund the share repurchase plan are needed for other business or operational purposes or that amendment, suspension or termination of the share repurchase plan is in the best interest of the Company’s stockholders. Therefore, stockholders may not have the opportunity to make a repurchase request prior to any potential termination of the Company’s share repurchase plan.

Pursuant to the share repurchase plan, for the year ended December 31, 2014, the Company reclassified $13,393,647, net of $2,723,947 of fulfilled redemption requests, from temporary equity, which is included as redeemable common stock on the accompanying consolidated balance sheets, to permanent equity. For the year ended December 31, 2013, the Company reclassified $10,078,483, net of $1,246,300 of fulfilled redemption requests, from permanent equity to temporary equity, which is included as redeemable common stock on the accompanying consolidated balance sheets. The redeemable common stock balance at any given time will consist of (1) DRP proceeds from the prior year plus (2) DRP proceeds from the current year through the current period less (3) actual current year redemptions paid or pending redemption.

On October 21, 2014, the Company’s board of directors elected to suspend the Company’s share repurchase plan, effective November 20, 2014. As a result, the Company has not processed redemption requests received after such date. The Company’s board of directors may in the future reinstate the share repurchase plan, although there is no assurance as to if or when this will happen.

Distributions

The Company’s long-term policy is to pay distributions from cash flow from operations. However, in order to provide additional available funds to pay distributions, the Company’s obligation to pay up to $5,000,000 of fees due to the Advisor pursuant to the Advisory Agreement was deferred. If, during any calendar quarter during the Public Offering, the distributions paid by the Company exceeded funds from operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts, plus (1) any acquisition expenses and acquisition fees expensed that are related to any property, loan or other investment acquired or expected to be acquired, and (2) any non-operating, non-cash charges incurred, such as impairments of property or loans, any other than temporary impairments of marketable securities, or other similar charges, for the quarter, which is defined in the Advisory Agreement as “Adjusted Funds From Operations,” the payment of fees the Company was obligated to pay the Advisor were deferred in an amount equal to the amount by which distributions paid to stockholders for the quarter exceeded Adjusted Funds From Operations for such quarter up to an amount equal to a 7.0% cumulative non-compounded annual return on stockholders’ invested capital, pro-rated for such quarter. On June 11, 2014, the Company issued $5,000,000 in restricted shares of common stock to the Advisor, subject to certain vesting requirements, as disclosed above, to settle the previously deferred fees due to the Advisor. As of December 31, 2014 and 2013, $0 and $5,000,000, respectively, of fees had been deferred pursuant to the Advisory Agreement.

Distributions Declared

Distributions declared to date (1) accrue daily to stockholders of record as of the close of business on each day, (2) are payable in cumulative amounts on or before the third day of each calendar month with respect to the prior month and (3) are calculated at a rate of $0.001964 per share per day, which if paid each day over a 365-day period is equivalent to a 7.0% annualized distribution rate based on a purchase price of $10.24 per share of common stock.

F-31

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Distributions declared for the years ended December 31, 2014 and 2013 were $54,296,664 and $28,645,761, including $22,220,101 and $11,628,045, or 2,283,669 shares and 1,195,071 shares, respectively, of common stock issued pursuant to the DRP.

As of December 31, 2014 and 2013, $4,679,455 and $4,058,452 distributions declared were payable, which included $0 and $1,963,570 of distributions reinvested pursuant to the DRP, respectively.

Distributions Paid

For the years ended December 31, 2014 and 2013, the Company paid cash distributions of $29,491,989 and $14,302,663, which related to distributions declared for each day in the period from December 1, 2013 through November 30, 2014 and December 1, 2012 through November 30, 2013, respectively. Additionally, for the years ended December 31, 2014 and 2013, 2,485,476 and 1,195,071 shares of common stock were issued pursuant to the DRP for gross offering proceeds of $24,183,672 and $11,628,045, respectively. For the years ended December 31, 2014 and 2013, the Company paid total distributions of $53,675,661 and $25,930,708.

7. Earnings (Loss) Per Share

The following table presents a reconciliation of net loss attributable to common stockholders and shares used in calculating basic and diluted earnings (loss) per share, or EPS, for the years ended December 31, 2014, 2013 and 2012:

	Years Ended December 31,
	2014			2013			2012
Net loss attributable to the Company	$	(25,742,292	)	$	(55,879,857	)	$	(22,559,927	)
Less: dividends declared on participating securities	203,990			—			—
Net loss attributable to common stockholders	(25,946,282		)	(55,879,857		)	(22,559,927		)
Weighted average common shares outstanding - basic and diluted	75,450,215			40,169,940			12,238,094
Loss per common share - basic and diluted	$	(0.34	)	$	(1.39	)	$	(1.84	)

As of December 31, 2014, the Company excluded 488,281.25 of unvested restricted common shares outstanding from the calculation of diluted loss per common share as the effect would have been antidilutive.

8. Related Party Arrangements

The Company has entered into the Advisory Agreement with the Advisor and a Dealer Manager Agreement with the Dealer Manager with respect to the Public Offering. Pursuant to the Advisory Agreement and the Dealer Manager Agreement, the Company is obligated to pay the Advisor specified fees upon the provision of certain services related to the investment of funds in real estate and real estate-related investments, the management of the Company’s investments and for other services (including, but not limited to, the disposition of investments) and the Public Offering that terminated on December 20, 2013. Subject to the limitations described below, the Company is also obligated to reimburse the Advisor and its affiliates for organization and offering costs incurred by the Advisor and its affiliates on behalf of the Company, and the Company is obligated to reimburse the Advisor and its affiliates for acquisition and origination expenses and certain operating expenses incurred on behalf of the Company or incurred in connection with providing services to the Company.

F-32

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Amounts attributable to the Advisor and its affiliates incurred for the years ended December 31, 2014, 2013 and 2012 are as follows:

	Incurred For the Year Ended December 31,
	2014		2013		2012
Consolidated Statements of Operations:
Expensed
Investment management fees(1)	$	13,252,309	$	7,409,393	$	1,887,866
Acquisition fees(1)	3,251,400		19,148,107		10,131,220
Acquisition expenses(2)	587,513		4,433,861		1,033,301
Property management
Fees(1)	5,802,772		3,226,878		960,968
Reimbursement of onsite personnel(3)	17,841,495		9,343,021		3,004,041
Other fees(1)	1,617,440		929,359		147,504
Other operating expenses(4)	980,195		3,561,399		1,427,993
Disposition fees(5)	463,688		—		—
Consolidated Balance Sheets:
Capitalized to real estate
Construction management fees	1,391,360		421,776		—
Additional paid-in-capital
Other offering costs reimbursement	—		13,271,892		9,820,681
Selling commissions	—		31,187,852		10,895,367
Dealer management fees	—		17,826,407		6,259,112
	$	45,188,172	$	110,759,945	$	45,568,053

________________

(1) Included in fees to affiliates in the accompanying consolidated statements of operations.

(2) Included in acquisition costs in the accompanying consolidated statements of operations.

(3) Included in operating, maintenance and management in the accompanying consolidated statements of operations.

(4) Included in general and administrative expenses in the accompanying consolidated statements of operations.

(5) Included in gain on sales of real estate, net in the accompanying consolidated statements of operations.

F-33

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Amounts attributable to the Advisor and its affiliates incurred and paid for the years ended December 31, 2014, 2013 and 2012 are as follows:

	Paid For the Year Ended December 31,
	2014		2013		2012
Consolidated Statements of Operations:
Expensed
Investment management fees	$	16,627,339	$	4,630,082	$	383,359
Acquisition fees	3,296,422		19,436,769		9,876,075
Acquisition expenses	583,511		4,577,909		997,180
Property management
Fees	5,717,813		2,960,930		834,537
Reimbursement of onsite personnel	17,827,185		8,976,013		2,848,511
Other fees	1,585,747		899,579		132,064
Other operating expenses	915,618		3,712,827		1,456,646
Disposition fees	463,688		—		—
Consolidated Balance Sheets:
Capitalized to real estate
Construction management fees	1,348,151		421,776		—
Additional paid-in-capital
Other offering costs reimbursement	3,105,246		10,279,559		9,799,471
Selling commissions	—		31,187,852		10,895,367
Dealer management fees	—		17,826,407		6,259,112
	$	51,470,720	$	104,909,703	$	43,482,322

F-34

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Amounts attributable to the Advisor and its affiliates that are payable as of December 31, 2014 and 2013 are as follows:

	Payable as of
	December 31, 2014		December 31, 2013
Consolidated Statements of Operations:
Expensed
Investment management fees(1)	$	1,155,012	$	4,530,042
Acquisition fees(2)	603,400		648,422
Acquisition expenses	4,002		—
Property management
Fees	501,540		416,581
Reimbursement of onsite personnel	583,161		568,851
Other fees	76,913		45,220
Other operating expenses	72,253		7,676
Disposition fees	—		—
Consolidated Balance Sheets:
Capitalized to real estate
Construction management fees	43,209		—
Additional paid-in-capital
Other offering costs reimbursement	—		3,105,246
Selling commissions	—		—
Dealer management fees	—		—
	$	3,039,490	$	9,322,038

________________

(1) Investment management fees earned by the Advisor totaling $0 and $4,351,578 were deferred as of December 31, 2014 and 2013, respectively, pursuant to the terms of the Advisory Agreement. The remaining investment management fees of $1,155,012 and $178,464 were due and payable and are included in due to affiliates in the accompanying consolidated balance sheets at December 31, 2014 and 2013, respectively.

(2) Acquisition fees earned by the Advisor totaling $0 and $648,422 were deferred as of December 31, 2014 and 2013, respectively, pursuant to the terms of the Advisory Agreement. The remaining acquisition fees of $603,400 and $0 were due and payable and are included in due to affiliates in the accompanying consolidated balance sheets at December 31, 2014 and 2013, respectively.

Organization and Offering Costs

The Company terminated the Public Offering on December 20, 2013. Prior to the termination of the Public Offering, organization and offering costs (other than selling commissions and dealer manager fees) of the Company were initially paid by the Advisor or its affiliates on behalf of the Company. These organization and other offering costs include all expenses to be paid by the Company in connection with the Public Offering and the prior private offering, including legal, accounting, printing, mailing and filing fees, charges of the Company’s transfer agent, expenses of organizing the Company, data processing fees, advertising and sales literature costs, transfer agent costs, bona fide out-of-pocket due diligence costs and amounts to reimburse the Advisor or its affiliates for the salaries of its employees and other costs in connection with preparing supplemental sales materials and providing other administrative services in connection with the Public Offering and the private offering. Reimbursement of expenses paid to the Advisor did not exceed the actual expenses incurred by the Advisor.

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Organization costs include all expenses incurred by the Company in connection with the formation of the Company, including, but not limited to, legal fees and other costs to incorporate the Company.

Included in organization and offering costs are payments made to Crossroads Capital Advisors, LLC (“Crossroads”), an affiliate of the Sponsor, for certain specified services provided to the Company on behalf of the Advisor, including, without limitation, establishing operational and administrative processes; engaging and negotiating with vendors; providing recommendations and advice for the development of marketing materials and ongoing communications with investors; assisting in public relations activities and the administration of the DRP and share redemption plan; and providing advice as to our real estate portfolio and property operations.

Pursuant to the Advisory Agreement, the Company was obligated to reimburse the Advisor or its affiliates, as applicable, for organization and offering costs paid by them on behalf of the Company in connection with the Public Offering, provided that the Advisor was obligated to reimburse the Company to the extent selling commissions, dealer manager fees and organization and offering costs incurred by the Company in the Public Offering exceed 15% of gross offering proceeds raised in the completed Public Offering. No amounts were owed to the Company by the Advisor pursuant to the Advisory Agreement.

Reimbursements to the Advisor or its affiliates for offering costs paid by them on behalf of the Company with respect to the Private Offering is not limited to 15% of the gross offering proceeds of the Private Offering. However, the Company elected not to make reimbursements of organization and offering costs in excess of 15% of the gross offering proceeds of the Private Offering unless approval was obtained from the independent directors of the Company. On November 19, 2013, the independent directors approved the reimbursement of the organization and offering costs in excess of 15% of the gross offering proceeds of the Private Offering. Accordingly, the Company reimbursed the Advisor $1,425,070 for such organization and offering costs in 2013. From inception through December 31, 2014, the total offering costs incurred by the Advisor or its affiliates and reimbursed by the Company with respect to the Private Offering was $2,301,719.

The amount of reimbursable organization and offering (“O&O”) costs related to the Public Offering that have been paid or recognized from inception through December 31, 2014 is as follows:

	Amount			Percentage of Gross Public Offering Proceeds
Gross offering proceeds from Public Offering (excluding DRP):	$	729,992,516		100.00	%
O&O limitation	15		%
Total O&O costs available to be paid/reimbursed	$	109,498,877		15.00	%
O&O expenses recorded
Sales commissions paid	44,413,086			6.08	%
Broker dealer fees paid	25,428,455			3.48	%
Public offering cost reimbursements	20,596,961			2.82	%
Public offering cost reimbursements accrual	3,105,247			0.43	%
Organizational cost reimbursements	100,738			0.01	%
Total O&O costs reimbursements recorded by the company	$	93,644,487		12.83	%

The Company also reimbursed certain costs of bona fide training and education meetings (primarily the travel, meal and lodging costs of registered representatives of broker-dealers), attendance and sponsorship fees and cost reimbursement of employees of the Company’s affiliates to attend seminars conducted by broker-dealers and, in special cases, reimbursement to participating broker-dealers for technology costs associated with the Public Offering, costs and expenses related to such technology costs, and costs and expenses associated with the facilitation of the marketing of the Company’s shares and the ownership of the Company’s shares by such broker-dealers’ customers; provided, however, that the Company did not pay any of

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

the foregoing costs to the extent that such payment would cause total underwriting compensation to exceed 10% of the gross proceeds of the Public Offering, as required by the rules of FINRA.

Organization costs are expensed as incurred. From inception until the Company terminated the Public Offering on December 20, 2013, the Company incurred $100,738 of organizational costs on the Company’s behalf, of which $100,738 was reimbursed to the Advisor. No organizational costs were incurred or recognized during the years ended December 31, 2014, 2013 and 2012.

Offering costs, including selling commissions and dealer manager fees, are deferred and charged to stockholders’ equity as such amounts are reimbursed to the Advisor, the Dealer Manager or their affiliates from gross offering proceeds. For each of the years ended December 31, 2014, 2013 and 2012, the Advisor did not incur any costs related to the Private Offering, however, during the quarter ended December 31, 2013, the Company reimbursed the Advisor for $1,425,070 of previously deferred offering costs related to the Private Offering. From inception through December 31, 2014, the Advisor had incurred total offering costs related to the Private Offering of $2,301,719.

For the year ended December 31, 2014, no amounts were reimbursed to the Advisor as the Public Offering terminated on December 30, 2013. For the years ended December 31, 2014, 2013 and 2012, the Company reimbursed the Advisor $0, $60,861,080 and $26,987,107, respectively, of offering costs related to the Public Offering, including $0, $3,203,872 and $1,458,000 of amounts paid to Crossroads for certain offering services provided to the Company.

The Company has reimbursed the Advisor $95,946,206 for organization and offering costs incurred from inception through December 31, 2014, including reimbursements of organization costs of $100,738, reimbursements of Private Offering costs of $2,301,719 and reimbursements of Public Offering costs of $93,543,749. The Company accrued $0 and $3,105,246 for the reimbursement of offering costs in the financial statements as of December 31, 2014 and 2013, respectively.

Investment Management Fee

The Company pays the Advisor a monthly investment management fee equal to one-twelfth of 0.80% of (1) the cost of real properties and real estate-related assets acquired directly by the Company or (2) the Company’s allocable cost of each real property or real estate-related asset acquired through a joint venture. Such fee is calculated including acquisition fees, acquisition expenses and any debt attributable to such investments, or the Company’s proportionate share thereof in the case of investments made through joint ventures. The cost of real properties and real estate-related assets that have been sold by the Company during the applicable month is excluded from the fee.

Acquisition Fees and Expenses

The Company pays the Advisor an acquisition fee equal to 2.0% of (1) the cost of investment, as defined in the Advisory Agreement, in connection with the acquisition or origination of any type of real property or real estate-related asset acquired directly by the Company or (2) the Company’s allocable portion of the purchase price in connection with the acquisition or origination of any type of real property or real estate-related asset acquired through a joint venture, including any acquisition and origination expenses and any debt attributable to such investments.

In addition to acquisition fees, the Company reimburses the Advisor for amounts directly incurred by the Advisor or its affiliates, including personnel-related costs for acquisition due diligence, legal and non-recurring management services, and amounts the Advisor pays to third parties in connection with the selection, acquisition or development of a property or acquisition of real estate-related assets, whether or not the Company ultimately acquires the property or the real estate-related assets.

The Charter limits the Company’s ability to pay acquisition fees if the total of all acquisition fees and expenses relating to the purchase would exceed 6.0% of the contract purchase price. Under the Charter, a majority of the Company’s board of directors, including a majority of the independent directors, is required to approve any acquisition fees (or portion thereof) that would cause the total of all acquisition fees and expenses relating to an acquisition to exceed 6.0% of the contract purchase price. In connection with the purchase of securities, the acquisition fee may be paid to an affiliate of the Advisor that is

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

registered as a FINRA member broker-dealer if applicable FINRA rules would prohibit the payment of the acquisition fee to a firm that is not a registered broker-dealer.

Property Management Fees and Expenses

The Company has entered into Property Management Agreements with Steadfast Management Company, Inc., an affiliate of the Sponsor (the “Property Manager”), in connection with the acquisition of each of the Company’s properties (other than EBT Lofts, Library Lofts and Stuart Hall Lofts, which are managed by an unaffiliated third-party management company). The property management fee payable with respect to each property under the Property Management Agreements (each a “Property Management Agreement”) ranges from 2.50% to 3.75% of the annual gross revenue collected which is usual and customary for comparable property management services rendered to similar properties in similar geographic markets, as determined by the Advisor and approved by a majority of the Company’s board of directors, including a majority of the independent directors. The Property Manager also receives an oversight fee of 1% of gross revenues at certain of the properties at which it does not serve as a property manager. Generally, each Property Management Agreement has an initial one year term and will continue thereafter on a month-to-month basis unless either party gives a 60 day prior notice of its desire to terminate the Property Management Agreement, provided that the Company may terminate the Property Management Agreement at any time without cause or upon an uncured breach of the Property Management Agreement upon 30 days prior written notice to the Property Manager.

In addition to the property management fee, the Property Management Agreements also specify certain other fees payable to the Property Manager or its affiliates, including benefit administration and training services. The Company also reimburses the Property Manager for the salaries and related benefits of on-site property management employees.

Construction Management Fees

The Company has entered into Construction Management Agreements with Pacific Coast Land and Construction, Inc., an affiliate of the Sponsor (the “Construction Manager”), in connection with the planned capital improvements and renovation for certain of the Company's properties. The construction management fee payable with respect to each property under the Construction Management Agreements (each a “Construction Management Agreement”) ranges from 8.0% to 12.0% of the costs of the improvements for which the Construction Manager has planning and oversight authority. Generally, each Construction Management Agreement has a term equal to the planned renovation timeline unless either party gives a 30 day prior notice of its desire to terminate the Construction Management Agreement. Construction management fees are capitalized to the respective real estate properties in the period in which they are incurred, as such costs relate to capital improvements and renovations for units taken out of service while they undergo the planned renovation.

Other Operating Expense Reimbursement

In addition to the various fees paid to the Advisor, the Company is obligated to pay directly or reimburse all expenses incurred by the Advisor in providing services to the Company, including the Company’s allocable share of the Advisor’s overhead, such as rent, employee costs, utilities and information technology costs. The Company will not reimburse the Advisor for employee costs in connection with services for which the Advisor or its affiliates receive acquisition fees or disposition fees or for the salaries the Advisor pays to the Company’s executive officers.

The Charter limits the Company’s total operating expenses during any four fiscal quarters to the greater of 2% of the Company’s average invested assets or 25% of the Company’s net income for the same period (the “2% 25% Limitation”). The Company may reimburse the Advisor, at the end of each fiscal quarter, for operating expenses incurred by the Advisor; provided, however, that the Company shall not reimburse the Advisor at the end of any fiscal quarter for operating expenses that exceed the 2%/25% Limitation unless the independent directors have determined that such excess expenses were justified based on unusual and non-recurring factors. The Advisor must reimburse the Company for the amount by which the Company’s operating expenses for the preceding four fiscal quarters then ended exceed the 2%/25% Limitation unless the independent directors have determined that such excess expenses were justified. For purposes of determining the 2%/25% Limitation amount, “Average invested assets” means the average monthly book value of the Company’s assets invested directly or indirectly in equity interests and loans secured by real estate during the 12-month period before deducting depreciation, bad

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

debts or other non-cash reserves. “Total operating expenses” means all expenses paid or incurred by the Company that are in any way related to the Company’s operation, including the Company’s allocable share of Advisor overhead and investment management fees, but excluding (a) the expenses of raising capital such as organization and offering expenses, legal, audit, accounting, underwriting, brokerage, listing, registration and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, listing and registration of shares of the Company’s common stock; (b) interest payments; (c) taxes; (d) non-cash expenditures such as depreciation, amortization and bad debt reserves; (e) reasonable incentive fees based on the gain in the sale of the Company’s assets; (f) acquisition fees and acquisition expenses (including expenses relating to potential acquisitions that the Company does not close); (g) real estate commissions on the resale of investments; and (h) other expenses connected with the acquisition, disposition, management and ownership of investments (including the costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of real property).

For the year ended December 31, 2014, the Advisor and its affiliates incurred $980,192 of the Company’s operating expenses, including the allocable share of the Advisor’s overhead expenses of $980,192, none of which were in excess of the 2%/25% Limitation and are included in the $6,896,519 of general and administrative expenses recognized by the Company. As of December 31, 2014, the Company’s total operating expenses were 0.1% of its average invested assets and 3.8% of its net loss.

For the year ended December 31, 2013, the Advisor and its affiliates incurred $3,561,399 of the Company’s operating expenses, including the allocable share of the Advisor’s overhead expenses of $3,561,399, none of which were in excess of the 2%/25% Limitation, and $2,571,910 of previously deferred operating expenses, all of which are included in the $7,106,568 of general and administrative expenses recognized by the Company.

For the year ended December 31, 2012, the Advisor and its affiliates incurred $1,427,993 of the Company’s operating expenses, including the allocable share of the Advisor’s overhead expenses of $930,187, none of which were in excess of the 2%/25% Limitation and are included in the $3,085,470 of general and administrative expenses recognized by the Company.

Disposition Fee

If the Advisor or its affiliates provides a substantial amount of services, as determined by the Company’s independent directors, in connection with the sale of a property or real estate-related asset, the Company will pay the Advisor or its affiliates 1.5% of the sales price of each property or real estate-related asset sold. To the extent the disposition fee is paid upon the sale of any assets other than real property, it will be included as an operating expense for purposes of the 2%/25% Limitation. In connection with the sale of securities, the disposition fee may be paid to an affiliate of the Advisor that is registered as a FINRA member broker-dealer if applicable FINRA rules would prohibit the payment of the disposition fee to a firm that is not a registered broker-dealer. The Charter limits the maximum amount of disposition fees payable to the Advisor for the sale of any real property to the lesser of one-half of the brokerage commission paid or 3% of the contract sales price, but in no event shall the total real estate commissions paid, including any disposition fees payable to the Advisor, exceed 6% of the contract sales price.

Selling Commissions and Dealer Manager Fees

Pursuant to the terms of the Dealer Manager Agreement, the Company paid the Dealer Manager up to 6.5% and 3.5% of the gross offering proceeds from the Primary Offering as selling commissions and dealer manager fees, respectively. A reduced sales commission and dealer manager fee was paid in connection with volume discounts and certain other categories of sales. No sales commission or dealer manager fee is paid with respect to shares of common stock issued pursuant to the DRP. The Dealer Manager was also able to reallow to any participating broker-dealer a portion of the dealer manager fee that was attributable to that participating broker-dealer for certain marketing costs of that participating broker-dealer. The Company did not pay any selling commissions or dealer manager fees to the Dealer Manager for the year ended December 31, 2014 because the Public Offering terminated on December 20, 2013.

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Restricted Stock Agreement

On June 11, 2014, the Company entered into a restricted stock agreement with the Advisor whereby the Company issued to the Advisor 488,281.25 restricted shares of the Company’s common stock at a fair market value of $10.24 per share in satisfaction of certain deferred fees due to the Advisor in the aggregate amount of $5,000,000. The shares of restricted stock vest and become non-forfeitable upon the earliest to occur of (i) 50% at December 31, 2015 and 50% at December 31, 2016, (ii) certain liquidity events of the Company, (iii) the Company’s cumulative modified funds from operations exceed the lesser of (a) the cumulative amount of distributions paid to the Company’s stockholders or (b) an amount that is equal to a 7.0% cumulative, non-compounded annual return on the Company’s stockholders’ invested capital, or (iv) the Company’s termination of, or failure to renew, the Advisory Agreement other than for “cause” (as defined in the Advisory Agreement). The shares of restricted stock shall be forfeited if the Advisor is terminated for any reason other than (iv) above.

9. Incentive Award Plan and Independent Director Compensation

The Company has adopted an incentive plan (the “Incentive Award Plan”) that provides for the grant of equity awards to its employees, directors and consultants and those of the Company’s affiliates. The Incentive Award Plan authorizes the grant of non-qualified and incentive stock options, restricted stock awards, restricted stock units, stock appreciation rights, dividend equivalents and other stock-based awards or cash-based awards. No awards have been granted under the Incentive Award Plan as of December 31, 2014 and 2013, except those awards granted to the independent directors as described below.

Under the Company’s independent directors’ compensation plan, which is a sub-plan of the Incentive Award Plan, each of the Company’s independent directors was entitled to receive 5,000 shares of restricted common stock in connection with the initial meeting of the Company’s full board of directors. The Company’s board of directors, and each of the independent directors, agreed to delay the initial grant of restricted stock until the Company raised $2,000,000 in gross offering proceeds in the Private Offering. In addition, on the date following an independent director’s re-election to the Company’s board of directors, he or she receives 2,500 shares of restricted common stock. One-fourth of the shares of restricted common stock generally vest and become non-forfeitable upon issuance and the remaining portion will vest in three equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant; provided, however, that the restricted stock will become fully vested and become non-forfeitable on the earlier to occur of (1) the termination of the independent director’s service as a director due to his or her death or disability, or (2) a change in control of the Company.

On August 8, 2012, the Company granted each of the three then independent directors 2,500 shares of restricted stock upon re-election to the Company’s board of directors. On October 1, 2012, the Company granted 5,000 shares of restricted common stock to each of its two new independent directors. On August 7, 2013, the Company granted each of the four independent directors 2,500 shares of restricted stock upon re-election to the Company’s board of directors. On August 5, 2014, the Company granted each of the four independent directors 2,500 shares of restricted stock upon re-election to the Company’s board of directors. In addition to the shares granted under the independent directors’ compensation plan, one of the independent directors elected to receive 50% of director compensation in stock through December 31, 2011. The Company recorded stock-based compensation expense of $118,145, $105,210 and $94,425 for the years ended December 31, 2014, 2013 and 2012 respectively.

10. Commitments and Contingencies

Economic Dependency

The Company is dependent on the Advisor and its affiliates for certain services that are essential to the Company, including the sale of the Company’s shares of common and preferred stock available for issue; the identification, evaluation, negotiation, purchase, and disposition of real estate and real estate-related investments; management of the daily operations of the Company’s real estate and real estate-related investment portfolio; and other general and administrative responsibilities. In the event that these companies are unable to provide the respective services, the Company will be required to obtain such services from other sources.

F-40

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Concentration of Credit Risk

The geographic concentration of the Company’s portfolio makes it particularly susceptible to adverse economic developments in the Houston, Texas, Chicago, Illinois and Austin, Texas apartment markets. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, relocations of businesses, increased competition from other apartment communities, decrease in demand for apartments or any other changes, could adversely affect the Company’s operating results and its ability to make distributions to stockholders.

Environmental

As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. The Company is not aware of any environmental liability that could have a material adverse effect on its financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities.

Legal Matters

From time to time, the Company is subject, or party, to legal proceedings that arise in the ordinary course of its business. Management is not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on the Company’s results of operations or financial condition nor is the Company aware of any such legal proceedings contemplated by government agencies.

F-41

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

11. Derivative Financial Instruments

The Company uses interest rate derivatives with the objective of managing exposure to interest rate movements thereby minimizing the effect of interest rate changes and the effect they could have on future cash flows. Interest rate cap agreements are used to accomplish this objective. As of December 31, 2014, the Company had 27 interest rate caps with notional amounts totaling $577,961,000. The following table provides the terms of the Company’s interest rate derivative instruments that were in effect at December 31, 2014 and 2013:

			Effective Date	Maturity Date	Notional Amount			Variable Rate		Cap Rate		Fair Value as of December 31,
Property	Type	Purpose					Based on					2014		2013
Ashley Oaks	Cap	Cap Floating Rate	10/24/2011	11/1/2016	$	21,712,000	One-Month LIBOR	0.17	%	5.00	%	$	1,291	$	19,729
Trails at Buda Ranch	Cap	Cap Floating Rate	3/28/2013	4/1/2018	17,030,000		One-Month LIBOR	0.17	%	2.00	%	138,826		335,483
Deer Valley	Cap	Cap Floating Rate	4/30/2013	5/1/2018	20,875,000		One-Month LIBOR	0.17	%	2.00	%	183,111		439,064
Grayson Ridge	Cap	Cap Floating Rate	6/26/2013	7/1/2017	10,725,000		One-Month LIBOR	0.17	%	2.00	%	43,957		115,262
Rosemont at Olmos Park	Cap	Cap Floating Rate	6/20/2013	7/1/2017	15,100,000		One-Month LIBOR	0.17	%	2.00	%	63,491		164,538
Meritage at Steiner Ranch	Cap	Cap Floating Rate	8/6/2013	9/1/2017	55,500,000		One-Month LIBOR	0.17	%	2.00	%	305,347		715,411
Tapestry Park	Cap	Cap Floating Rate	9/23/2013	10/1/2017	23,100,000		One-Month LIBOR	0.17	%	3.56	%	39,380		154,735
Stuart Hall	Cap	Cap Floating Rate	8/27/2013	9/1/2017	12,407,000		One-Month LIBOR	0.17	%	3.50	%	10,624		62,083
BriceGrove Park	Cap	Cap Floating Rate	9/24/2013	10/1/2017	14,985,000		One-Month LIBOR	0.17	%	3.42	%	30,337		110,612
Landing at Mansfield	Cap	Cap Floating Rate	9/27/2013	10/1/2017	22,750,000		One-Month LIBOR	0.17	%	2.50	%	92,718		251,548
The Heights	Cap	Cap Floating Rate	9/30/2013	10/1/2017	29,014,000		One-Month LIBOR	0.17	%	2.50	%	103,812		312,618
Villas at Huffmeister	Cap	Cap Floating Rate	10/10/2013	11/1/2017	25,963,000		One-Month LIBOR	0.17	%	2.50	%	103,746		303,798
Villas at Kingwood	Cap	Cap Floating Rate	10/10/2013	11/1/2017	28,105,000		One-Month LIBOR	0.17	%	2.50	%	112,305		328,862
Waterford Place at Riata Ranch	Cap	Cap Floating Rate	10/10/2013	11/1/2017	16,340,000		One-Month LIBOR	0.17	%	2.50	%	65,293		191,198

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STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

			Effective Date	Maturity Date	Notional Amount			Variable Rate		Cap Rate		Fair Value as of December 31,
Property	Type	Purpose					Based on					2014		2013
Carrington Place	Cap	Cap Floating Rate	11/7/2013	11/30/2014	$	22,376,000	One-Month LIBOR	0.17	%	2.00	%	$	81,621	$	302,878
				11/30/2015						2.50	%
				11/30/2016						3.25	%
				12/1/2018						4.10	%
Carrington at Champion Forest	Cap	Cap Floating Rate	11/7/2013	11/30/2014	22,959,000		One-Month LIBOR	0.17	%	2.00	%	83,747		310,770
				11/30/2015						2.50	%
				11/30/2016						3.25	%
				12/1/2018						4.10	%
Carrington Park	Cap	Cap Floating Rate	11/7/2013	11/30/2014	17,717,000		One-Month LIBOR	0.17	%	2.00	%	64,626		239,815
				11/30/2015						2.50	%
				11/30/2016						3.25	%
				12/1/2018						4.10	%
Willow Crossing	Cap	Cap Floating Rate	11/20/2013	11/30/2014	43,500,000		One-Month LIBOR	0.17	%	2.00	%	74,581		448,006
				11/30/2015						2.50	%
				11/30/2016						3.25	%
				12/1/2018						4.65	%
Audubon Park	Cap	Cap Floating Rate	12/27/2013	12/31/2014	11,760,000		One-Month LIBOR	0.17	%	2.00	%	22,879		184,362
				12/31/2015						2.75	%
				12/31/2016						3.50	%
				12/31/2017						4.25	%
				1/1/2019						4.75	%
Mallard Crossing	Cap	Cap Floating Rate	12/27/2013	12/31/2014	27,860,000		One-Month LIBOR	0.17	%	2.00	%	68,863		350,479
				12/31/2015						2.50	%
				12/31/2016						3.00	%
				1/1/2018						3.40	%
Renaissance at Carol Stream	Cap	Cap Floating Rate	1/9/2014	1/31/2015	20,440,000		One-Month LIBOR	0.17	%	2.00	%	46,166		—
				1/31/2016						2.50	%
				1/31/2017						3.00	%
				2/1/2018						3.64	%
Mapleshade Park	Cap	Cap Floating Rate	3/31/2014	3/31/2015	15,161,000		One-Month LIBOR	0.17	%	2.50	%	7,404		—
				3/31/2016						3.00	%
				4/1/2017						3.57	%
Windsor on the River(1)	Cap	Cap Floating Rate	5/9/2014	5/31/2015	23,500,000		One-Month LIBOR	0.17	%	2.00	%	54,950		121,310
				5/31/2016						2.50	%
				5/31/2017						3.00	%
				6/1/2018						3.86	%

F-43

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

			Effective Date	Maturity Date	Notional Amount			Variable Rate		Cap Rate		Fair Value as of December 31,
Property	Type	Purpose					Based on					2014		2013
Oak Crossing	Cap	Cap Floating Rate	6/3/2014	5/31/2015	$	15,762,000	One-Month LIBOR	0.17	%	2.00	%	$	60,823	$	—
				5/31/2016						2.50	%
				5/31/2017						3.00	%
				6/3/2018						3.50	%
Cantare at Indian Lake Village	Cap	Cap Floating Rate	7/9/2014	7/31/2015	18,850,000		One-Month LIBOR	0.17	%	2.00	%	66,969		—
				7/31/2016						2.50	%
				7/31/2017						3.00	%
				8/1/2018						3.50	%
Park Shore	Cap	Cap Floating Rate	9/12/2014	9/30/2015	12,845,000		One-Month LIBOR	0.17	%	2.00	%	23,244		—
				9/30/2016						2.50	%
				10/1/2017						3.00	%
Tapestry Park	Cap	Cap Floating Rate	12/1/2014	10/1/2017	11,625,000		One-Month LIBOR	0.17	%	2.81	%	28,828		—
					$	577,961,000						$	1,978,939	$	5,462,561

_________________

(1) As of December 31, 2013, the Company had an interest rate cap agreement at the Windsor on the River property with a fair value of $121,310. The interest rate cap had a notional amount of $23,500,000, an effective date of February 9, 2012 and a scheduled maturity date of February 1, 2019. The interest rate cap was based on the SIFMA Municipal Swap Index, with a variable rate of 0.06% and a fixed rate of 3.00%. Simultaneously with the refinancing of the mortgage loan payable on May 9, 2014 (see Note 5), the interest rate cap was terminated and replaced with a new interest rate cap agreement, the terms of which are disclosed in the above table.

The interest rate cap agreements are not designated as cash flow hedges. Accordingly, the Company records any changes in the fair value of the interest rate cap agreements as interest expense. The change in the fair value of the interest rate cap agreements for the years ended December 31, 2014 and 2013 resulted in an unrealized loss of $4,353,301 and $448,984, respectively, which is included in interest expense in the accompanying consolidated statements of operations. The fair value of interest rate caps of $1,978,939 and $5,462,561 are included in deferred financing costs and other assets, net on the accompanying consolidated balance sheets.

12. Pro Forma Information (unaudited)

The following table summarizes, on an unaudited basis, the consolidated pro forma results of operations of the Company for the years ended December 31, 2014 and 2013. The Company acquired seven properties during the year ended December 31, 2014. These properties contributed $7,043,199 of revenues and $2,128,011 of net loss, including $4,279,615 of depreciation and amortization, to the Company’s results of operations from the date of acquisition to December 31, 2014. The following unaudited pro forma information for the years ended December 31, 2014 and 2013 has been provided to give effect to the acquisitions of the properties as if they had occurred on January 1, 2013. This pro forma information does not purport to represent what the actual results of operations of the Company would have been had these acquisitions occurred on this date, nor does it purport to predict the results of operations for future periods.

F-44

	Year Ended December 31,
	2014			2013
Revenues	$	202,656,889		$	125,027,746
Net (loss) income	$	(20,960,767	)	$	(55,852,848	)
Loss per common share - basic and diluted	$	(0.27	)	$	(0.73	)
Weighted-average number of common shares outstanding, basic and diluted	76,858,483			76,858,483

The pro forma information reflects adjustments for actual revenues and expenses of the properties acquired during the year ended December 31, 2014 for the respective period prior to acquisition by the Company. Net loss has been adjusted as follows: (1) interest expense has been adjusted to reflect the additional interest expense that would have been charged had the Company acquired the properties on January 1, 2013 under the same financing arrangements as existed as of the acquisition date; (2) depreciation and amortization has been adjusted based on the Company’s basis in the properties; and (3) transaction costs have been adjusted for the acquisition of the properties.

13. Selected Quarterly Results (unaudited)

Presented below is a summary of the Company’s unaudited quarterly financial information for the year ended December 31, 2014 and 2013:

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Total
2014
Revenues	$	45,679,704		$	49,224,059		$	50,217,617		$	50,808,476		$	195,929,856
Net loss	(14,082,911		)	(3,653,679		)	(3,337,573		)	(4,668,129		)	(25,742,292		)
Loss per common share, basic and diluted	(0.19		)	(0.05		)	(0.05		)	(0.05		)	(0.34		)
Distributions declared per common share	0.177			0.179			0.181			0.181			0.718
2013
Revenues	$	18,590,756		$	22,370,453		$	28,761,843		$	39,378,465		$	109,101,517
Net loss	(8,591,901		)	(7,746,115		)	(14,707,104		)	(24,834,737		)	(55,879,857		)
Loss per common share, basic and diluted	(0.34		)	(0.24		)	(0.34		)	(0.42		)	(1.39		)
Distributions declared per common share	0.177			0.179			0.181			0.181			0.718

14. Subsequent Events

Distributions Paid

On January 2, 2015, the Company paid distributions of $4,679,455, which related to distributions declared for each day in the period from December 1, 2014 through December 31, 2014. All such distributions were paid in cash.

On February 2, 2015, the Company paid distributions of $4,679,536, which related to distributions declared for each day in the period from January 1, 2015 through January 31, 2015. All such distributions were paid in cash.

On March 2, 2015, the Company paid distributions of $4,226,611, which related to distributions declared for each day in the period from February 1, 2015 through February 28, 2015. All such distributions were paid in cash.

STEADFAST INCOME REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

DECEMBER 31, 2014

Estimated Value per Share

On March 10, 2015, the Company’s board of directors determined an estimated value per share of the Company’s common stock of $10.35 as of December 31, 2014.

F-46

STEADFAST INCOME REIT, INC.

SCHEDULE III

REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION AND AMORTIZATION

DECEMBER 31, 2014

Description	Location	Owner-ship Percent	Encumbrances(2)		Initial Cost of Company						Cost Capitalized Subsequent to Acquisition		Gross Amount at which Carried at Close of Period						Accumulated Depreciation and Amortization			Original Date of Construction	Date Acquired
					Land		Building and Improvements(1)		Total				Land		Building and Improvements(1)		Total(2)
Park Place	Des Moines, IA	100%	$	4,890,068	$	500,000	$	7,823,400	$	8,323,400	$	884,955	$	410,000	$	7,983,975	$	8,393,975	$	(1,387,684	)	1986	12/22/10
Clarion Park	Olathe, KS	100%	8,479,259		1,470,991		9,744,009		11,215,000		393,950		1,470,991		9,856,044		11,327,035		(1,416,084		)	1994	6/28/11
Cooper Creek	Louisville, KY	100%	6,500,887		593,610		9,826,390		10,420,000		368,869		593,610		10,011,049		10,604,659		(1,353,731		)	1997	8/24/11
Truman Farm Villas	Grandview, MO	100%	5,709,615		842,987		8,257,013		9,100,000		657,659		842,987		8,674,043		9,517,030		(1,164,524		)	2008	12/22/11
EBT Lofts	Kansas City, MO	100%	5,397,291		460,362		8,114,638		8,575,000		166,929		460,362		7,939,249		8,399,611		(931,145		)	1899	12/30/11
Windsor on the River	Cedar Rapids, IA	100%	23,500,000		3,381,946		29,618,054		33,000,000		1,029,987		3,381,946		29,455,112		32,837,058		(3,410,922		)	1982	1/26/12
Renaissance St. Andrews	Louisville, KY	100%	8,937,635		838,685		11,661,315		12,500,000		566,328		838,685		11,985,239		12,823,924		(1,432,097		)	2001	2/17/12
Spring Creek of Edmond	Edmond, OK	100%	13,577,868		2,346,503		17,602,343		19,948,846		421,027		2,346,503		17,617,978		19,964,481		(2,064,948		)	1974	3/9/12
Montclair Parc	Oklahoma City, OK	100%	23,827,037		3,325,556		32,424,444		35,750,000		766,735		3,325,556		32,005,584		35,331,140		(3,322,130		)	1999	4/26/12
Sonoma Grande	Tulsa, OK	100%	22,324,719		2,737,794		29,462,206		32,200,000		316,727		2,737,794		29,229,320		31,967,114		(3,081,080		)	2009	5/24/12
Estancia	Tulsa, OK	100%	21,485,523		2,544,634		27,240,628		29,785,262		328,928		2,544,634		27,047,992		29,592,626		(2,715,117		)	2006	6/29/12
Montelena	Round Rock, TX	100%	12,290,751		1,860,351		17,375,907		19,236,258		646,730		1,860,351		17,567,477		19,427,828		(1,728,189		)	1998	7/13/12
Valley Farms	Louisville, KY	100%	10,068,528		724,771		14,375,229		15,100,000		220,883		724,771		14,335,523		15,060,294		(1,314,942		)	2007	8/30/12
Hilliard Park	Hilliard, OH	100%	13,563,481		1,413,437		18,484,692		19,898,129		441,052		1,413,437		18,520,423		19,933,860		(1,643,031		)	2000	9/11/12
Sycamore Terrace	Terre Haute, IN	100%	—		1,321,194		21,852,963		23,174,157		129,059		1,321,194		21,536,437		22,857,631		(1,650,456		)	2011/2013	9/20/12, 3/5/14
Hilliard Summit	Hilliard, OH	100%	16,436,620		1,536,795		22,639,028		24,175,823		105,340		1,536,795		22,295,716		23,832,511		(1,950,811		)	2012	9/28/12
Springmarc Apartments	San Marcos, TX	100%	15,166,129		1,917,909		20,027,929		21,945,838		89,228		1,917,909		19,685,279		21,603,188		(1,742,485		)	2008	10/19/12
Renaissance at St. Andrews Condos	Louisville, KY	100%	—		92,255		1,282,745		1,375,000		274,302		92,255		1,530,382		1,622,637		(140,936		)	2001	10/31/12
Ashley Oaks	San Antonio, TX	100%	21,296,125		3,819,796		26,970,204		30,790,000		1,911,719		3,819,796		28,146,141		31,965,937		(2,504,895		)	1985	11/29/12
Arrowhead	Palatine, IL	100%	12,321,880		2,094,728		14,655,272		16,750,000		272,208		2,094,728		14,524,881		16,619,609		(1,216,516		)	1976	11/30/12
Moorings, The	Roselle, IL	100%	14,896,178		2,250,208		17,999,792		20,250,000		417,783		2,250,208		17,996,109		20,246,317		(1,461,918		)	1976	11/30/12

F-47

STEADFAST INCOME REIT, INC.

SCHEDULE III

REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION AND AMORTIZATION (CONTINUED)

DECEMBER 31, 2014

Description	Location	Owner-ship Percent	Encumbrances(2)		Initial Cost of Company						Cost Capitalized Subsequent to Acquisition		Gross Amount at which Carried at Close of Period						Accumulated Depreciation and Amortization			Original Date of Construction	Date Acquired
					Land		Building and Improvements(1)		Total				Land		Building and Improvements(1)		Total(2)
Forty 57	Lexington, KY	100%	$	38,500,000	$	3,055,614	$	49,444,386	$	52,500,000	$	592,074	$	3,055,614	$	49,274,575	$	52,330,189	$	(3,955,796	)	2008	12/20/12
Keystone Farms	Nashville, TN	100%	6,100,287		1,052,401		7,347,599		8,400,000		193,408		1,052,401		7,361,148		8,413,549		(613,007		)	1998	12/28/12
Riverford Crossing	Frankfort, KY	100%	21,900,000		2,595,387		27,404,613		30,000,000		259,787		2,595,387		27,122,366		29,717,753		(2,228,858		)	2011	12/28/12
Southpointe at Valley Farms	Louisville, KY	100%	1,155,185		2,212,402		3,062,598		5,275,000		2,084,403		2,212,402		5,080,965		7,293,367		(253,626		)	2010	12/28/12
Montecito	Austin, TX	100%	14,003,890		3,081,522		15,918,478		19,000,000		986,343		3,081,522		16,470,625		19,552,147		(1,382,068		)	1984	12/31/12
Hilliard Grand	Dublin, OH	100%	28,832,151		2,657,734		38,012,528		40,670,262		122,607		2,657,734		37,318,468		39,976,202		(2,876,265		)	2010	12/31/12
Hills at Fair Oaks	Fair Oaks Ranch, TX	100%	24,767,000		3,008,363		31,700,639		34,709,002		70,976		3,008,363		31,145,823		34,154,186		(2,426,170		)	2012	1/31/13
Library Lofts	Kansas City, MO	100%	8,941,943		1,669,405		11,080,595		12,750,000		80,855		1,669,405		10,955,483		12,624,888		(826,812		)	1906/1923	2/28/13
Trails at Buda Ranch	Buda, TX	100%	16,821,368		2,504,114		20,495,886		23,000,000		257,479		2,504,114		20,247,295		22,751,409		(1,408,578		)	2009	3/28/13
Deep Deuce	Oklahoma City, OK	100%	26,639,205		2,529,318		37,266,648		39,795,966		4,178,064		2,529,318		40,769,636		43,298,954		(3,079,333		)	2001	3/28/13
Deer Valley	Lake Bluff, IL	100%	20,645,873		2,494,142		26,105,858		28,600,000		891,757		2,494,142		26,468,707		28,962,849		(1,788,610		)	1991	4/30/13
Grayson Ridge	North Richland, TX	100%	10,631,586		1,594,099		12,705,901		14,300,000		805,962		1,594,099		13,158,089		14,752,188		(891,147		)	1988	5/31/13
Rosemont at Olmos Park	San Antonio, TX	100%	14,667,462		2,064,447		19,985,553		22,050,000		196,851		2,064,447		19,759,281		21,823,728		(1,218,293		)	1995	5/31/13
Retreat at Quail North	Oklahoma City, OK	100%	17,029,692		1,700,810		24,025,543		25,726,353		124,380		1,700,810		23,661,280		25,362,090		(1,519,480		)	2012	6/12/13
Lodge at Trails Edge	Indianapolis, IN	100%	12,657,096		2,389,613		16,128,107		18,517,720		250,152		2,389,613		15,992,639		18,382,252		(983,798		)	1981	6/18/13
Arbors of Carrollton	Carrollton, TX	100%	6,261,078		1,424,432		7,560,527		8,984,959		332,652		1,424,432		7,668,989		9,093,421		(507,407		)	1984	7/3/13
Waterford on the Meadow	Plano, TX	100%	16,603,668		2,625,024		20,849,131		23,474,155		968,409		2,625,024		21,252,374		23,877,398		(1,251,098		)	1984	7/3/13
Belmont	Grand Prairie, TX	100%	9,295,899		1,550,028		11,264,510		12,814,538		392,157		1,550,028		11,294,024		12,844,052		(641,906		)	1983	7/26/13
Meritage at Steiner Ranch	Austin, TX	100%	55,198,913		7,353,620		73,356,373		80,709,993		3,892,886		7,353,620		75,798,476		83,152,096		(4,157,161		)	2001	8/6/13
Tapestry Park	Birmingham , AL	100%	34,725,000		3,277,884		47,118,797		50,396,681		46,686		3,277,884		46,543,160		49,821,044		(2,029,998		)	2012/2014	8/13/13, 12/1/14
Dawntree	Carrollton, TX	100%	15,833,312		3,135,425		21,753,469		24,888,894		857,825		3,135,425		22,008,833		25,144,258		(1,266,026		)	1982	8/15/13
Stuart Hall	Kansas City, MO	100%	12,350,045		1,585,035		15,264,965		16,850,000		94,485		1,585,035		15,074,691		16,659,726		(834,019		)	1910	8/27/13

F-48

STEADFAST INCOME REIT, INC.

SCHEDULE III

REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION AND AMORTIZATION (CONTINUED)

DECEMBER 31, 2014

Description	Location	Owner-ship Percent		Encumbrances(2)		Initial Cost of Company						Cost Capitalized Subsequent to Acquisition		Gross Amount at which Carried at Close of Period						Accumulated Depreciation and Amortization			Original Date of Construction	Date Acquired
						Land		Building and Improvements(1)		Total				Land		Building and Improvements(1)		Total(2)
Bricegrove Park	Canal Winchester, OH	100%		$	14,932,281	$	1,596,212	$	18,503,788	$	20,100,000	$	274,279	$	1,596,212	$	18,327,247	$	19,923,459	$	(1,016,108	)	2002	8/29/13
Retreat at Hamburg Place	Lexington, KY	100%		—		1,605,839		14,694,161		16,300,000		144,720		1,605,839		14,510,966		16,116,805		(807,472		)	2013	9/5/13
Cantare - Indian Lake Village	Nashville, TN	100%		18,850,000		2,489,757		26,510,243		29,000,000		84,390		2,489,757		26,133,132		28,622,889		(1,354,055		)	2013	9/24/13
Landing at Mansfield "Broadstone"	Mansfield, TX	100%		22,671,543		3,375,831		27,524,169		30,900,000		187,777		3,375,831		27,079,482		30,455,313		(1,377,333		)	2006	9/27/13
Heights at 2121	Houston, TX	100%		28,912,294		9,869,925		27,130,075		37,000,000		1,254,094		9,869,925		27,022,438		36,892,363		(1,567,445		)	1977	9/30/13
Villas at Huffmeister	Houston, TX	100%		25,917,180		5,858,663		31,741,337		37,600,000		446,075		5,858,663		31,466,996		37,325,659		(1,611,134		)	2007	10/10/13
Villas at Kingwood	Kingwood, TX	100%		28,055,400		6,512,468		33,637,532		40,150,000		434,172		6,512,468		33,282,882		39,795,350		(1,707,341		)	2008	10/10/13
Waterford Place Riata Ranch	Cypress, TX	100%		16,310,966		3,184,857		20,215,143		23,400,000		237,592		3,184,857		19,952,745		23,137,602		(1,036,635		)	2008	10/10/13
Carrington Place	Houston, TX	100%		22,376,000		5,450,417		27,449,583		32,900,000		567,148		5,450,417		27,322,570		32,772,987		(1,295,031		)	2004	11/7/13
Carrington Champion Forest	Houston, TX	100%		22,959,000		3,760,329		29,239,671		33,000,000		472,784		3,760,329		29,096,560		32,856,889		(1,394,601		)	2008	11/7/13
Carrington Park at Huffmeister	Houston, TX	100%		17,717,000		3,241,747		21,908,253		25,150,000		371,950		3,241,747		21,755,858		24,997,605		(1,055,396		)	2008	11/7/13
Willow Crossing	Elk Grove Village, IL	100%		43,500,000		8,091,870		49,908,130		58,000,000		2,085,531		8,091,870		50,278,754		58,370,624		(2,359,191		)	1977-81	11/20/13
Echo at Katy Ranch	Katy, TX	100%		—		4,402,862		30,419,853		34,822,715		69,629		4,402,862		30,015,762		34,418,624		(1,278,678		)	2013	12/19/13
Heritage Grand Sienna Plantation	Missouri City, TX	100%		16,697,112		3,776,547		22,762,411		26,538,958		87,036		3,776,547		22,303,306		26,079,853		(980,242		)	2012	12/19/13
Audubon Park	Nashville, TN	100%		11,760,000		2,489,428		14,260,572		16,750,000		1,367,495		2,489,428		15,208,974		17,698,402		(651,683		)	1968	12/27/13
Mallard Crossing	Loveland, OH	100%		27,860,000		2,383,256		37,416,744		39,800,000		443,109		2,383,256		37,189,280		39,572,536		(1,460,261		)	1997	12/27/13
Renaissance Carol Stream	Carol Stream, IL	100%		20,440,000		4,605,682		24,544,318		29,150,000		528,547		4,605,682		24,498,937		29,104,619		(984,873		)	1972	12/31/13
Reserve at Creekside	Chattanooga, TN	100%		—		1,344,233		17,530,767		18,875,000		108,929		1,344,233		17,287,672		18,631,905		(547,597		)	2004	3/28/14
Mapleshade Park	Dallas, TX	100%		15,161,000		3,585,171		19,739,829		23,325,000		497,577		3,585,171		19,628,807		23,213,978		(588,365		)	1995	3/28/14
Richland Falls	Murfreesboro, TN	100%		13,800,000		1,306,794		19,693,206		21,000,000		27,262		1,306,794		19,449,823		20,756,617		(483,082		)	2012-13	5/16/14
Oak Crossing	Fort Wayne, IN	100	%	15,762,000		2,005,491		22,224,509		24,230,000		45,058		2,005,491		21,853,096		23,858,587		(512,287		)	2012-13	6/3/14
Park Shore	St. Charles, IL	100	%	12,845,000		1,619,712		16,730,288		18,350,000		84,538		1,619,712		16,814,826		18,434,538		(500,546		)	1965	9/12/14
				$	1,070,757,025	$	174,192,422	$	1,459,075,487	$	1,633,267,909	$	37,910,285	$	174,102,422	$	1,462,850,991	$	1,636,953,413	$	(98,342,452	)

F-49

STEADFAST INCOME REIT, INC.

SCHEDULE III

REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION AND AMORTIZATION (CONTINUED)

DECEMBER 31, 2014

________________

(1) Building and improvements include tenant origination and absorption costs and other intangible assets.

(2) Encumbrences include the unamortized portion of loan premiums (discounts) on assumed debt allocated to individual assets in the aggregate amount of $4.7 million as of December 31, 2014.

(3) The aggregate cost of real estate for federal income tax purposes was $1.64 billion as of December 31, 2014.

A summary of activity for real estate and accumulated depreciation for the years ended December 31, 2014, 2013 and 2012:

	2014			2013			2012
Real estate:
Balance at the beginning of the year	$	1,519,883,478		$	578,045,449		$	69,866,681
Acquisitions	130,339,157			950,409,834			505,158,918
Improvements	26,806,872			9,125,416			3,019,850
Cost of real estate sold	(22,738,038		)	(90,000		)	—
Write-off of fully depreciated and fully amortized assets	(17,338,056		)	(17,607,221		)	—
Balance at the end of the year	$	1,636,953,413		$	1,519,883,478		$	578,045,449
Accumulated depreciation:
Balance at the beginning of the year	$	48,920,319		$	18,073,362		$	3,115,505
Depreciation expense	69,681,177			48,454,178			14,957,857
Write-off of accumulated depreciation and amortization of real estate assets sold	(2,920,988		)	—			—
Write-off of fully depreciated and fully amortized assets	(17,338,056		)	(17,607,221		)	—
Balance at the end of the year	$	98,342,452		$	48,920,319		$	18,073,362

F-50

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Irvine, State of California, on March 18, 2015.

Steadfast Income REIT, Inc.

By:	/s/ Rodney F. Emery
Rodney F. Emery
Chief Executive Officer and Chairman of the Board

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:

Name	Title	Date
/s/ Rodney F. Emery	Chief Executive Officer and Chairman of the Board (principal executive officer)
Rodney F. Emery		March 18, 2015
/s/ Kevin J. Keating	Treasurer (principal financial officer and principal accounting officer)
Kevin J. Keating		March 18, 2015
/s/ Ella S. Neyland
Ella S. Neyland	President and Director	March 18, 2015
/s/ Scot B. Barker
Scot B. Barker	Director	March 18, 2015
/s/ Larry H. Dale
Larry H. Dale	Director	March 18, 2015
/s/ James A. Shepherdson
James A. Shepherdson	Director	March 18, 2015

Name	Title	Date
/s/ Kerry D. Vandell
Kerry D. Vandell	Director	March 18, 2015
/s/ Ned W. Brines
Ned W. Brines	Director	March 18, 2015