Initial RAD PBRA contract rents are capped at 120 percent of FMR less utility allowance, with an RCS-backed exception to the lower of market or 150 percent of FMR

rad_pbra.rent_limit.initial_contract_rent_cap · v1.0.0

HUD calculates initial PBRA contract rents from the converting project's own subsidy under the public housing programme using its RAD rent base year, and specifies alternative requirements for section 8(c)(1) and section 8(c)(5) of the Act and 24 CFR 880.503(b) to do so. Whatever that calculation and the Notice's flexibilities produce, initial contract rents are capped at 120 percent of the Section 8 fair market rent, adjusted for bedroom count and after subtracting any applicable utility allowance. Where HUD's calculation exceeds that cap and the PHA believes the rents are below comparable market rent, the PHA may request an exception permitting rents above 120 percent but not above the lower of comparable market rents or 150 percent of FMR. HUD grants such a request only where a Rent Comparability Study, which the PHA must procure and pay for, establishes that rents are below comparable market rents, and the decision is in HUD's sole and absolute discretion. No RCS is required where initial contract rents are at or below 120 percent of FMR.

Confidence

high

Effective from

2019-09-05

Last reviewed

2026-08-31