Last updated on September 27th, 2024
On August 14, HUD published Fiscal Year (FY2025) Fair Market Rents (FMRs), as well as a Federal Register notice, entitled “Fair Market Rents (FMRs) for the Housing Choice Voucher Program, Moderate Rehabilitation Single Room Occupancy Program; and Other Programs; Fiscal Year 2025.” The notice provides details about the FMRs and instructions on how to submit comments or request a reevaluation.
The recently published FMRs take effect October 1, 2024. As explained in 2024 FMR FAQs, “FMRs are an estimate of the amount of money that would cover gross rents (rent and utility expenses) on 40 percent of the rental housing units in an area. FMRs are used in several HUD programs, including determining the maximum amount a Housing Choice Voucher will cover.”
The updated FMRs may result in changes to the rent level subsidies. For areas where FMRs are increasing, owners may be able to raise rents (within defined limits). On the other hand, for areas where FMRs are decreasing, owners may see tighter rent controls. Ultimately, this will impact residents’ costs for rent as well.
Mandatory Small Area FMR (SAMFR) use has been expanded to another 41 metropolitan areas, which are identified in the Federal Register notice.
According to the notice, comments are due before October 1 and requests for reevaluation of FMRs are due 30 days after the Federal Register notice was published (although some sources indicate HUD may accept reevaluation requests submitted before October 1).
The Federal Register notice includes details about how PHAs can submit comments or request a reevaluation. (Others who want to request a reevaluation should work through their local PHA.) Refer to the notice for complete details. Highlights include:
- Reference Docket No. FR-6479-N-01 and the notice’s title: “Fair Market Rents for the Housing Choice Voucher Program, Moderate Rehabilitation Single Room Occupancy Program, and Other Programs; Fiscal Year 2025.”
- The PHA for the area or PHAs representing at least 50% of voucher tenants in an FMR area must agree reevaluation is necessary.
- The requestor must provide HUD with more recent data than the 2022 ACS data used to calculate FY 2025 FMRs. Details are in section V.A.(2) of the Federal Register notice.
- Indicate whether the FY 2024 FMR will be maintained or the FY 2025 FMR will be implemented during the reevaluation period. (Per the notice: PHAs requesting reevaluation of newly designated SAFMR areas may adopt FY 2024 SAFMRs or FY 2025 SAFMRs during the reevaluation period. Following the comment period, HUD will post a list, at https://www.huduser.gov/portal/datasets/fmr.html, of the areas requesting reevaluations where FY 2024 FMRs remain in effect.)
- Submit electronically via the Federal eRulemaking Portal at https://www.regulations.gov. Submissions can also be made via mail, although electronic submissions are encouraged. The mailing address is Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street SW, Room 10276, Washington, DC 20410-0500.
As you navigate the FY 2025 FMRs and what they may mean to your organization or tenants, you can count on RBT CPAs to focus on your accounting, audit, tax, and advisory needs. Give us a call to find out how we can be Remarkably Better Together.
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