Homeownership Center Reference Guide

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Chapter 1
Appraisal and Property Requirements Unique Properties: Non Residential Use Page 1-17d   

Any nonresidential use of the property shall be subordinate to its residential use and character. A property, any portion of which is designed or used for nonresidential purposes, is eligible only if the type and extent of the nonresidential use does not impair the residential character of the property.

Areas designed or used for nonresidential purposes shall not exceed 25 percent of the total floor area. Storage areas or similar spaces which are integral parts of the nonresidential portion shall be included in the total nonresidential area. Please see: HUD Handbook 4905.1 Rev-1, Section 2-6.

On 203(k) mortgages, the percentage floor area used for commercial purposes follows these standards:

	Unique properties
	Shared lots with undivided interest
	Excess land
	Non residential use
	Move ons
	Forest and farm property tax deferral programs