HUD’s Proposed FY16 Fair Market Rents (FMRs) were published in the September 8 Federal Register for public comment. Comments are due by October 8.
FMRs are used to determine payment standards for the Housing Choice Voucher (HCV) program and initial renewal rents for some project-based Section 8 contracts. FMRs also serve as rent ceilings for the HOME Investments Partnership program.
FMRs are set at the 40th percentile of gross rent in most metropolitan areas, the top end of the price range that new movers could expect to pay for the lowest priced 40% of apartments. But in select metropolitan areas, FMRs are set at the 50th percentile for a three-year time period. The 50th percentile FMRs are intended to expand the range of housing opportunities available to voucher households, enabling them move out of low opportunity areas. In FY16, there will be 13 areas classified as 50th percentile FMR areas: Albuquerque, Chicago, Denver, Hartford, Honolulu, Kansas City, MO, Milwaukee, Philadelphia, Riverside, CA, Tacoma, Virginia Beach, Washington, DC, and West Palm Beach, FL.
HUD is evaluating the use of 50th percentile FMRs, as some research indicates it may not be the most effective approach to deconcentrate voucher holders. HUD is exploring the use of Small Area FMRs (SAFMRs) to provide more housing opportunities to voucher holders. SAFMRs reflect rents in U.S. ZIP code-based areas. The goal of SAFMRs is to provide voucher holders with subsidies that better reflect rents at the neighborhood level, providing them with more rental housing options. For FY16, public housing authorities in Dallas, Cook County, IL, Long Beach, CA, Chattanooga, Mamaroneck, NY, and Laredo, TX are using SAFMRs to manage their voucher programs.
The Proposed FY16 FMRs can be viewed at http://www.huduser.org/portal/datasets/fmr.html