HUD Archives: News Releases
HUD No. 00-223
Further Information: For Release
In the Washington, DC area: 202/708-0685 Tuesday
Or contact your local HUD office September 12, 2000

Fair Market Rents: Frequently Asked Questions
FMR Technical Description

CUOMO EXPANDS RENTAL OPPORTUNITY FOR HUNDREDS OF THOUSANDS OF LOW-INCOME FAMILIES

WASHINGTON - Housing and Urban Development Secretary Andrew Cuomo today announced a new policy designed to help hundreds of thousands of low-income families keep pace with America's booming economy. The new policy will increase the pool of apartments affordable to families receiving federal housing vouchers by 25% or more than 1.4 million units nationwide.

"In some places, rents are rising twice as fast as inflation making it nearly impossible for our poorest neighbors to find a decent place to live," said Secretary Cuomo. "We can - and will - do more to close the economic gap that is leaving far too many families behind."

Over the past three years, rents have risen more than one-and-a-half times faster than inflation and twice as fast in some markets. According to HUD's State of the Cities 2000 report, "rather than benefiting from the surging economy, low-income renters are left to compete for a dwindling supply of affordable rental housing on the private market." Some recipients are being forced to return their vouchers because they can't find an apartment that qualifies under HUD's current rent guidelines.

While the nation is experiencing unprecedented economic prosperity, a record 5.4 million very low-income families either pay more than half of their income for housing or live in severely substandard conditions, including a growing number of families working full-time. In certain rental hot spots, HUD will increase rental subsidies to voucher-holders by increasing the so-called Fair Market Rent. By increasing the Fair Market Rent in these communities, more than 1.4 million additional apartments will become affordable to families receiving Section 8 rental assistance.

The change will affect areas where the rental climate has been particularly challenging for low-income voucher-holders. Some of these communities contain concentrated pockets of poverty whose residents find it difficult to locate landlords outside their neighborhoods who will accept their
vouchers. As a result of HUD's new policy, more families will be able to use their rental vouchers in neighborhoods of their choice and to move closer to areas of job opportunities.

New Jersey Senator Frank Lautenberg said, "While much of America has enjoyed boom times, over 5 million low income families are having a rough time paying rent, often for inadequate housing. This action by HUD will help thousands of families in New Jersey and across the country, afford a decent and safe place to live."

California Senator Dianne Feinstein said, "Until today some families in Sacramento and San Diego waited up to eight or 10 years for a Section 8 certificate only to find they were unable to use it because there were no vacant apartments available in the allowable price range. This boost in Fair Market Rents will ensure that few, if any, certificates will go unused in these cities and other high cost areas."

The following is an initial list of metropolitan areas, containing more than 450 communities, that meet the new criteria for raising the Fair Market Rent.

Albuquerque, NMNorfolk-Virginia Beach-Newport News, VA
Atlanta, GAOakland, CA
Austin-San Marcos, TXOklahoma City, OK
Baton Rouge, LAOrange County, CA
Bergen-Passaic, NJPhiladelphia, PA
Buffalo-Niagra Falls, NYPhoenix-Mesa, AZ
Chicago, ILRichmond-Petersburg, VA
Cleveland-Lorain-Elyria, OHSacramento, CA
Dallas, TXSalt Lake City, UT
Denver, COSan Antonio, TX
Detroit, MISan Diego, CA
Fort Lauderdale, FLSan Jose, CA
Fort Worth-Arlington, TXSt. Louis, MO
Grand Rapids-Muskegon-Holland, MITampa-St. Petersburg-Clearwater, FL
Houston, TXTulsa, OK
Kansas City, MOVentura, CA
Las Vegas, NVWashington, DC-MD-VA-WV
Miami, FLWest Palm Beach-Boca Raton, FL
Minneapolis-St. Paul, MN-WIWichita, KS
Newark, NJ

The following are additional communities that have reported problems with voucher usage and would qualify for higher subsidy levels should their problems persist: Baltimore, MD; Birmingham, AL; Boston, MA; Burlington, VT; Charlotte, NC; Malden, MA; Marin Co., CA; Milwaukee Co.,WI; Raleigh, NC; and Santa Monica, CA.

Any housing agency in the country that can document difficulties with voucher usage will be eligible to use the higher subsidy levels. Specifically, communities will qualify for the increased
subsidy standard where: (1) during a six-month period, more than a quarter of the families issued vouchers cannot find housing; or (2) voucher-holders are concentrated in a limited number of neighborhoods and affordable housing is not widely available throughout the metropolitan area.

"In communities where people are struggling to use their vouchers, we will step in and make it easier for renters to use the assistance we provide to find a place for their families to call home," said Cuomo. "It's now up to the Congress to fully fund HUD's budget request to provide the rental assistance so many families desperately need."

HUD's proposed FY 2001 budget request includes an additional 120,000 new vouchers to help address the nation's worst-case housing needs. In addition, to ensure voucher-holders receive help locating suitable rental units, HUD's proposed FY2001 budget currently before Congress includes an innovative $50 million Housing Voucher Success Fund that will provide assistance for families to search for a wider variety of available housing.

Fair Market Rents are used to calculate the maximum subsidy HUD provides families with Section 8 vouchers, also known as Housing Choice Vouchers. For the past five years, this subsidy standard was set at a level allowing voucher-holders access to 40% of newly-available rental units. In certain high-rent markets, HUD will now raise Fair Market Rents to the 50th percentile, allowing voucher-holders access to half of newly-available rental units. As a result, HUD estimates more than 1.4 million additional rental units would become affordable for families living in these communities - a 25% increase.

The Section 8 Housing Choice voucher program is the largest of HUD's three programs that assist low-income families with affordable rental housing. More than 1.4 million families receive Section 8 vouchers which they can use to find housing in the private market. Under Section 8, most Housing Choice voucher-holders pay no more than 30 percent of their income toward rent, with the federal government paying the balance. Section 8 vouchers can now also be used to help qualifying families purchase their first home.

MEMBERS OF CONGRESS AND MAYORS EXPRESS SUPPORT FOR HUD’S FAIR MARKET RENT INITIATIVE

Rep. Stephanie Tubbs Jones (OH) - “As Housing Task Force Chair of the Congressional Black Caucus, I stand here as one who has seen firsthand the difficulties faced by many families who simply cannot afford a place to live. HUD is on the right track in seeing a problem and finding an appropriate solution to remedy the situation. HUD’s approach demonstrates its support of a balanced housing policy that provides housing opportunities for all.”

Rep. Jan Schakowsky (IL) - “I applaud Secretary Cuomo for this latest action because it will help ensure that many families in Chicago will not be forced out of their homes and their neighborhoods. Today’s action is a significant step that proves that we have the resources and the will to help families live in safe and suitable neighborhoods.”

Congresswoman Eleanor Holmes Norton (DC) - These revised regulations will make a world of difference to D.C.'s low-income residents who are trying to provide decent housing for their families.

Mayor Anthony Williams, Washington, D.C, - “As the District is experiencing prosperity, affordable housing continues to be in great demand. This new initiative will give low-income families more options and ensure that no one is left behind.”

Mayor Donald Plusquellic, Akron (OH) - “On behalf of the U.S. Conference of Mayors, we support Secretary Cuomo in his announcement of a national housing policy that will expand rental opportunity and choice for our nation’s low-income families.”

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Content Archived: December 13, 2009