Rent ReasonablenessThis page provides an in-depth look at the rent reasonableness process for units leased under the Housing Choice Voucher (Section 8) program. This information is designed to help housing providers, owners, and property managers understand the importance of rent reasonableness and how it impacts the determination of approved rents for Section 8 leases.
What is Rent Reasonableness?As described in 24 CFR §982.507, rent reasonableness is a federal requirement mandated by the U.S. Department of Housing and Urban Development (HUD) to ensure that rents charged to Housing Choice Voucher holders are fair, reasonable, and comparable to similar units in the open market without assistance. The process is a crucial part of the voucher program, aiming to prevent inflated rents and ensure that federal subsidies are used effectively.
Why is Rent Reasonableness Important?
- Market Fairness: Rent reasonableness helps maintain a level playing field in the housing market, ensuring that properties leased to voucher holders are priced similarly to unassisted units. This fairness encourages a diverse housing stock for all income levels.
- Compliance with HUD Regulations: Adhering to rent reasonableness requirements is necessary for compliance with HUD guidelines, which is essential for the continued funding and operation of the Housing Choice Voucher program.
- Optimal Use of Public Funds: By ensuring that rents are aligned with market rates, the Housing Authority can use its limited Housing Assistance Payment (HAP) resources more efficiently, supporting more families in need of housing assistance.
- Protection for Tenants: The process protects Section 8 voucher tenants from being overcharged for rent, promoting affordability and stability in their housing situation.
How is Rent Reasonableness Determined?The Long Beach Housing Authority utilizes the GoSection8 tool (now part of AffordableHousing.com), among other resources, to conduct rent reasonableness evaluations. This process involves comparing the proposed rent for a unit with rents for similar, unassisted units in the area, taking into account factors such as:
- Size and layout
- Utilities included
For any questions or additional information, please contact the Leasing and Contracting team at the Housing Authority at HA-Owners@longbeach.gov or (562) 570-5372.
The following are the rules regarding assisted rents under the Section 8 Housing Choice Voucher Program:
- HUD requires HACLB to pay rental rates that are appropriate for the neighborhood.
- The tenant's rent is based on the household paying 30% of household income toward rent and HACLB paying the remainder.
- Tenants may pay up to 40% of the family's monthly income for rent at the time the lease is executed.
- Rent approval is always subject to the Rent Reasonableness process.
Effective April of 2023, the CPI decreased to 3.8%, which amounts to 8.8% in total given the base of 5%. Therefore, the maximum allowable rent increase is 8.8% annually, effective July 1, 2023.
It is the City of Long Beach’s position that HUD subsidies administered by the Housing Authority are not exempt from this law, which means that rental units within Long Beach are covered under AB 1482. Thus, the Housing Authority will not process any rent increases beyond 8.8% of the current rent and will not accept any 90-day notices without cause.
While we are not able to assist with enforcement beyond notifying the owner of our rejection, if you believe you were subject to an improper rent increase or no-cause eviction, please contact Fair Housing at (562) 989-1206 or Legal Aide at (562) 435-3501.
The Housing Authority of the City of Long Beach will continue to use affordablehousing.com to conduct rent reasonableness and apply AB 1482 to all applicable cases. Property owners and managers will need to credit residents for any adjustments made by the Housing Authority.