HUD will provide rental assistance only for a unit whose rent is reasonable against comparable unassisted units and no higher than the same owner charges for its own comparables

coc.rent_limit.rent_reasonableness_and_grant_amount_at_fmr · v1.0.0

HUD will only provide rental assistance for a unit if the rent is reasonable. The recipient or subrecipient must determine whether the rent charged for the unit receiving rental assistance is reasonable in relation to rents being charged for comparable unassisted units, TAKING INTO ACCOUNT the location, size, type, quality, amenities, facilities, and management and maintenance of each unit; and the reasonable rent MUST NOT EXCEED rents currently being charged by the SAME OWNER for comparable unassisted units. Separately, the amount of rental assistance in each project is calculated by multiplying the number and size of units proposed by the Fair Market Rent of each unit on the date the application is submitted to HUD, by the term of the grant -- the FMR sizes the grant, it is not a ceiling on the rent of an individual unit. Where the amount reserved exceeds what is needed, because contract rents are below FMRs or participants pay a portion, the recipient may use the excess to cover rent increases or to serve more participants. Grant funds may also be used for security deposits not exceeding two months of rent, and an advance payment of the last month's rent may be provided to the landlord in addition to the security deposit and first month's rent.

Confidence

high

Effective from

2012-08-30

Consequence model

agency finding with cure

Last reviewed

2026-08-29