Is Rent Comparability Study Required? Chapter 11 Lender Underwriting HUD Review 11.1 Lender Underwriting A. Pre-application. HUD has come up with thresholds for adjustments beyond a "nominal amount". All Rights Reserved. Why you should join NAHMA. Therefore, it is important to review both Chapter Nine of the Section 8 Renewal Policy and your … Please see our Rental Assistance resource page. The videos provide training on preparing and reviewing rent comparability studies. The total amount awarded is over $500,000 to Fair Housing agencies. The Rent Comparability Studies are prepared in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the supplemental standards of HUD Chapter 9. Prepare a separate Rent Grid for each primary Section 8 unit type. All Rent Comparability Studies must be completed in accordance with the requirements set forth in Chapter 9 of the Section 8 Renewal Policy guide and HUD… A Rent Comparability Study (RCS) must be submitted with a Section 8 contract renewal. When a Lender is contemplating submitting a pre-application to HUD, the Lender should provide HUD immediately in writing the names and qualifications of the proposed in-house underwriter, contract appraiser, and/or contract market analyst. The RCS appraiser must rate the subject and comparables on a five-point scale:  Excellent, Good, Average, Fair or Poor. HUD posted a series of four videos about rent comparability studies (RCS) based on the recently revised Chapter 9 of the Section 8 Renewal Policy Guide (see Memo, 7/17). The purpose of a Rent Comparability Study (RCS) is to estimate “market” rents for each Section 8 unit type. Chapter 9 was completely reorganized and updated. All specifics are outlined in Appendix 9-1-2 of Chapter 9. Section 8 Renewal Guide: Chapter 9, Rent Comparability Studies. It is important to note that the owner’s Rent Comparability Study will undergo a test to ensure that they do not exceed 140 percent of the median “Gross Rent By Zip Code Tabulation Area” as published by the U.S. Bureau of the Census. The agencies span across 12 states. Over the past few years, the Department has undertaken a series of reforms to improve the RCS. 1. This feature is not available right now. Selecting rent comparables is a key element of effectively preparing a rent comparability study. Enter the comparable’s name and address at the top of each column. Vickie discusses everything you need to know about the resuming of REAC physical inspections, including all the protocols and strategies HUD and REAC are using to avoid the spread of COVID-19. Owners (and their RCS appraisers) must ensure that all materials are submitted in electronic copy reports in the same order as shown on the owner's checklist. Proposed Changes to Chapter 9 (Rent Comparability) HUD is proposing the use of raw census data as a comparison of proposed renewal rents established by an owner contracted Rent Comparability Study (RCS) for the purposes of determining whether a second HUD-contracted RCS is warranted. Rent Comparability Study In accordance with Chapter 9 of the Section 8 Renewal Guide) ... and data from Random Digit Dialing (RDD) rent-change surveys of the HUD regions. The purpose of a Rent Comparability Study (RCS) is to estimate “market” rents for 6 each Section 8 unit type. HUD issued a revised Chapter 9 of the HUD Section 8 Renewal Guidebook on December 1, 2016. HUD Sec.8 Rent Comparability Study (RCS) In a changing market we recognize that the rent study is critical to making safe and sound investment decisions Our professionals provide individually tailored solutions for public agencies, lenders, developers, investors, corporations and property owners faced with diverse real estate issues and opportunities. The new Chapter 9 and the appendices are posted under “What’s New” “Revised Chapter 9 Rent Comparability Studies (Published 12/1/16, Effective 3/1/17)” at Option Two, Contract Renewals for Other Projects with Current Rents At or Below Comparable Market Rents Learn more here.We've also updated our MOR Protocol.Need help paying rent? Market rents … HUD released Housing Notice H 2020-10 on November 6, 2020. “Market Rent” is the rent that a knowledgeable tenant would most probably pay for Section 8 units, as of the date of the appraiser’s report, if the tenants were not receiving rental subsidies and rents were not restricted by HUD … Over the past few years, the Department has undertaken a series of reforms to improve the RCS. For properties with a Utility Allowance, please remember that if a Utility Allowance Analysis results in a decrease in the Utility Allowance for any Contract Renewal or annual Rent Adjustment, that the Owner and Contract Administrator must follow the same tenant notification procedures. Click here. The Notice must be in the format prescribed by HUD. HUD has become very specific in how an appraiser answers the grid and category questions. The Rent Comparability Study (RCS) is HUD’s tool for estimating market rents for Section 8 projects. (Section 2-15) i. The revised guidance applies to any Rent Comparability Study signed by the appraiser on or after March 1, 2017. The transmittal cover sheet provides a summary of the changes. In conjunction with Section 524(a) of the Multifamily Assisted Housing Reform and Affordability Act, multi-family rental project Owners with expiring Section 8 project-based contracts or those who are refinancing subsidized properties are required to submit a Rent Comparability Study. The Revision can be found here: https://portal.hud.gov/hudportal/documents/huddoc?id=Com-package-11-30-16.pdf. The Rent Comparability Studies are prepared in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the supplemental standards of HUD Chapter 9. 2. In many policy areas, HUD allows PHAs the flexibility to make local policy decisions, so it is important to note when a policy must be adopted as required by HUD. Please review the Revised Chapter Nine in order to ensure that any Rent … RCS appraisers are required to explain the rationale for the amount of adjustments when adjusting comparables to the subject property. Rent Comparability Studies. I. This final version of Chapter 9 includes HUD’s comprehensive technical guidance for creating rent comparability studies using a more market-based approach as part of the rent-setting mechanism under the Multifamily Assisted Housing Reform and Affordability Act (MAHRA). Please send any questions you may have on the new Guide to  Section8RenewalGuide@hud.gov. Data Columns. The U.S. Department of Housing and Urban Development (HUD) has updated guidance for Electronic Signature, Transmission and Storage. Recently, HUD issued revised instructions for the RCS as part of the reform process. Because the RCS is submitted to HUD, it must meet specific requirements and guidelines. The changes: 1. The content highlights provisions unique to RCSs when prepared for an annual adjustment factor (AAF) rent determination (Section 9-2.C). The Rent Comparability Study (RCS) is HUD’s tool for estimating market rents for Section 8 projects. Here are the highlights of changes relative to Rent Comparability Studies and their submission to New Hampshire Housing: As with all Section 8 Contract Renewals, please be certain to use the most current version of the (1) Contract Renewal Request form HUD-9624: https://portal.hud.gov/hudportal/documents/huddoc?id=9624.pdf. Because the RCS is submitted to HUD, it must meet specific requirements and guidelines. See Section 9-9A2 for guidance on classifying unit types as primary or secondary. © Copyright 2018 Navigate Housing. Navigate Affordable Housing Partners is a nonprofit that actively works to enhance all aspects of the housing industry to ensure that people have access to quality, livable housing choices. On Monday, September 21st, HUD announced it's giving additional funding to 15 Fair Housing Assistance Program (FHAP) agencies. COVID-19 Supplemental Payments Still Available, Corrected Model Forms for VAWA are now available on hud.gov. As with all Section 8 Contract Renewals, please be certain to use the most current version of the (1) Contract Renewal Request form HUD-9624: https://portal.hud.gov/hudportal/documents/huddoc?id=9624.pdf. User Login. The new Chapter 9 and the appendices are posted under “What’s New” “Revised Chapter 9 Rent Comparability Studies (Published 12/1/16, Effective 3/1/17)” at  http://www.hud.gov/offices/hsg/mfh/mfhsec8.cfm. The transmittal  cover sheet provides a summary of the changes. Please login to access NAHMA exclusive content. The U.S. Department of Housing and Urban Development (HUD) issued substantial revisions Dec. 1, 2016, to Chapter 9 of the Section 8 Renewal Policy Guide, which provides guidance to appraisers and reviewers for completing a rent comparability study (RCS). Below, please find additional information from HUD regarding the rent comparability studies (RCSs) update, including a link to a training video.The revisions to Chapter 9 of the Section 8 Renewal Policy Guide go into effect on March 1, 2017. In announcing the proposed change, HUD states: REAC is back! This funding is to support activities related to COVID-19. OWNER’S COVER LETTER FOR RENT COMPARABILITY STUDY. December 9, 2016. The policy changes will be effective for all rent comparability studies signed by the appraiser after March 1, 2017. The RCS is HUD’s tool for estimating market rents for private properties that have Section 8 Project-based Rental Assistance contracts. Reorganize Chapter 9 to identify the responsibilities of each business partner (owners, appraisers and reviewers) in one place. No other classifications like G+ G- are acceptable. Navigate is open for business during the COVID-19 pandemic. NAHMA HUD Update: Draft Chapter 9 of the Section 8 Renewal Policy Guide Released ... a rent comparability study. Date: Owner Name: Owner Address: Property Name: Property MN Number: 1. Provide modifications to Chapter 7 of Handbook 4350.1 concerning budget-based rent increases for MAHRA contracts. The RCS appraiser must explain how the market rent was derived, why it was derived that way and note which comparables were given the most weight and why. Over the past few years, the Department has undertaken a series of reforms to improve the RCS. 9, Section 916 of the U. S. Department of Housing and Urban Development (HUD) Section 8 - Renewal Policy Guide the following statements regarding the Rent Comparability Study commissioned for (Name of Property) are true: 1. This guidance will apply to any Rent Comparability Study signed by the appraiser on or after March 1, 2017. The Department has undertaken a number of initiatives to improve the development and review of rent comparability studies, and this revised Chapter 9 … 1 Chapter Nine 2 Rent Comparability Studies 3 BACKGROUND 4 Section 9-1 5 A. It is mandatory for the RCS appraiser to compare the RCS market rent to the "Median Rent by Zip Code" rent to determine if the RCS median rent exceeds 140% of the zip code rent. X. To ensure HUD continually provides the most up-to-date guidance on evolving program policies and procedures, the HCV Guidebook chapters will be living documents on HUD’s website. HUD has incorporated an Owner's Checklist which needs to be submitted, along with the Owner's RCS Cover Letter, with all materials. Section 8 Renewal Policy Guide (published June 2017) 140% of Census Median Rent by Zip Code Table (December 2019) Effective for any RCS signed by the appraiser on or after February 11, 2020 New Memo: Clarification on Use of Median Gross Rents for High Cost Zip Codes When Determining HUD Rent Comparability Study Requirements 2. General Guidelines: Mark-Up-to-Market: Yes Mark-Up-to-Budget: Yes Please follow-up with your PBCA, TCA, or HUD Project Manager for details affecting your specific property. 2020-10 on November 6, 2020 the amount of adjustments when adjusting to... 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