Contract rents adjust on the contract anniversary on owner request, and no adjustment may produce a material difference between assisted and comparable unassisted rents

pbra.rent_limit.contract_rent_adjustment_and_comparability_limitation · v1.0.0

On request from the owner to the contract administrator, contract rents are adjusted on the anniversary date of the Housing Assistance Payments contract in accordance with 24 CFR part 888. Special additional adjustments are granted to the extent HUD determines necessary to reflect increases in the actual and necessary expenses of owning and maintaining the assisted units that have resulted from substantial general increases in real property taxes, assessments, utility rates and utilities not covered by regulated rates and that are not adequately compensated by the annual adjustment; the owner must submit the required supporting data, financial statements and certifications. An overall limitation governs both: any adjustment of contract rents after contract execution or cost certification must not result in material differences between the rents charged for assisted units and comparable unassisted units, except to the extent such differences existed in the contract rents set at execution or cost certification. HUD Handbook 4350.3 does not itself publish the adjustment factors; it routes the request. Submission requirements for a budget-based increase, an annual adjustment factor increase or a utility allowance change are in HUD Handbook 4350.1, Multifamily Asset Management and Project Servicing; where the Section 8 contract has been renewed under the Multifamily Assisted Housing Reform and Affordability Act, they are in the Section 8 Contract Renewal Policy Guide. An approved change takes effect on the date HUD or the Contract Administrator approved, which may be retroactive, and the owner must then correct the tenant certification, adjust the monthly subsidy voucher and transmit the revised data to the Contract Administrator or TRACS.

Confidence

high

Effective from

1979-10-15

Consequence model

contract remedy

Last reviewed

2026-09-02