An owner may request a rent increase after the initial term (first 12- months) of the lease. The request must be made within 60 days of the Housing Assistance Payment contract renewal. The owner determines the amount of the increase. Section 8 staff must determine, however, that the contract rent after the increase is still reasonable compared to other similar, unsubsidized units in the market area. The tenant must also agree to the rent increase.

If the new contract rent requested by the owner is not rent reasonable, the owner must decrease the rent to a reasonable rent, or the housing assistance payment contract will be terminated with a 30-day notice to the landlord and tenant. If the tenant decides they can not afford the increase in rent, they are eligible to relocate with a thirty (30) day notice to the landlord and the IHA.

If granted, the rent increase is effective sixty (60) days after the request is received by the IHA

2.  Why are comparable rents required?

Under Federal regulations, agencies administering the Section 8 Voucher Program must ensure that rents charged by owners to voucher program participants are reasonable. This determination involves two comparisons. First, the rent charged must be comparable to rents charged for similar unassisted units in the marketplace. Second, the rents charged under the Voucher Program must be comparable to rents for similar units on the premises.

3.  What is the IHA's marketplace?

The IHA's Section 8 program serves Marion County.

4.  When are comparable rents required?

The IHA must determine rent reasonableness in the following instances:

1. Before entering into a HAP contract. A PHA must not execute a HAP contract until it has documented that the rent being charged is reasonable.

2. Before any increase in the rent to owner. The IHA must approve any rent increase proposed by the owner and accepted by the program participant. Before approval, the IHA must determine and document whether the proposed rent is reasonable compared to similar units in the marketplace and not in excess of higher than those paid by unassisted tenants in other rental.

3. If there is a five percent decrease in the published FMR (for the unit size rented by the family) in effect 60 days before the contract anniversary date as compared with the FMR in effect one year before the contract anniversary date. This provision is designed to ensure that when the market goes down by a significant amount, (i.e., a five percent or more reduction in the FMR,) the IHA must reexamine rent reasonableness at the contract anniversary date, even if the owner does not request an increase). 

5.  What obligation does the owner have for comparable rents?

By accepting each monthly housing assistance payment from the IHA, the owner certifies that the rent to owner is not more than rent charged by the owner for comparable unassisted units on the premises. The owner must provide information verifying rents charged when requested by the housing agency.

6.  What criteria are used to obtain comparable rents?

In determining comparability, the IHA must consider, at a minimum:
Location, quality, size, unit type, and age of the contract unit, and
Amenities, housing services, maintenance, and utilities to be provided by the owner must provide in accordance with under the lease. 

7.  How do utilities provided by the owner effect the comparable rent?

If utilities are provided by the owner, the comparable rent will reflect an amount that includes utilities as determined by the IHA's Annual Utility Allowance Schedule.

8.  If the owner has an unassisted unit in the building which is like and similar to the assisted unit which rents for more than the comparable the inspector found outside of the building, can the rent be based on the owner's unassisted unit?

No. HUD regulations require at least one comparable rent from a "like and similar" unassisted unit, not owned by the owner. Comparable units must be located with the same zip code as the subject property. 

9.  What should an owner do if the owner does not agree?

The owner may provide additional certified information for unassisted comparable rents and the name and phone number of a contact person so that the IHA may verify the comparable rents submitted by the owner. Comparable units must be located with the same zip code as the subject property. The IHA's Comparable Rent Survey form must be used.