Navigating the HOME Final Rule- Key Updates on Property Standards and Inspections

The U.S. Department of Housing and Urban Development (HUD) recently updated the HOME Investment Partnerships Program (HOME) Final Rule, emphasizing enhanced property standards and inspection requirements for participating jurisdictions (PJs). These updates aim to improve safety, accessibility, energy efficiency, and disaster resilience across affordable housing projects.

New Construction Projects

For new construction projects under the HOME program, the following standards are essential:

1. Accessibility Compliance: Projects must comply with the design and construction requirements of 24 CFR part 8, Titles II and III of the Americans with Disabilities Act (ADA), and the Fair Housing Act.
2. Energy Efficiency: Compliance with energy standards such as ASHRAE Standard 90.1-2019 for high-rise multifamily buildings and the 2021 International Energy Conservation Code for single-family and low-rise multifamily buildings is mandatory.
3. Disaster Mitigation: New constructions must incorporate features that mitigate future disaster risks in alignment with state and local codes.
4. Detailed Documentation: Construction contracts and documents must be sufficiently detailed to facilitate inspections.
5. Broadband Infrastructure: Broadband installation is required for projects with more than four rental units unless it poses significant financial or logistical challenges.
6. Detection Systems: Carbon monoxide and smoke detection systems must comply with HUD standards.

Rehabilitation Projects

Rehabilitation projects are subject to the following requirements:

1. Code Compliance: All projects must meet applicable state and local codes or, in their absence, HUD’s minimum property standards.
2. Disaster Preparedness: Measures to mitigate future disaster impacts are mandatory.
3. Inspection Documentation: As with new construction, detailed contracts and documents must support the inspection process.
4. Detection Systems: Carbon monoxide and smoke detection systems are required, with allowances for battery-powered smoke alarms in specific cases.
5. Green Building Standards: If the project’s cost exceeds the maximum per-unit subsidy limit, it must meet green building standards.

Acquisition of Existing Housing

For existing housing acquisitions, specific standards apply:

1. Recent Construction or Rehabilitation: Properties built or rehabilitated within 12 months before commitment must meet the respective standards.
2. Safe and Sanitary Conditions: Homes intended for homeownership must be decent, safe, and sanitary, with inspections conducted no earlier than 90 days before commitment.
3. Timely Compliance: Properties must meet standards at purchase or within six months of acquisition, which can be extended to 12 months if necessary.

Combination Projects

Combination projects that include rehabilitation and new construction must apply the respective standards to each component.

Ongoing Property Condition Standards and Inspections

To maintain compliance throughout the affordability period, ongoing requirements include:

1. Code Adherence: Properties must meet state and local codes and HUD standards.
2. Detection Systems: Carbon monoxide and smoke detection systems remain mandatory.
3. Inspection Frequency:
   1. Initial and annual inspections for tenant-based rental assistance units.
   1. On-site inspections within 12 months of project completion and every three years thereafter.
   1. Increased inspection frequency for properties with health and safety deficiencies.
4. Acceptance of Alternative Inspections: Inspections under other HUD programs or HUD-approved standards may be accepted.

Inspection Procedures

To ensure consistency and thoroughness, inspection procedures must include:

1. Detailed Checklists: Inspection checklists and process descriptions.
2. Training: Training and certification protocols for inspectors.
3. Sampling Standards:
   1. At least four units must be inspected for projects with up to 20 HOME-assisted units.
   1. For projects with 21-130 units, 20% must be inspected.
   1. For larger projects, inspection sampling aligns with the NSPIRE methodology.
4. Small-Scale Housing: Streamlined requirements for projects with 1-4 units to reduce administrative burdens.

Conclusion

The updated HOME Final Rule provides a robust framework to enhance the quality, safety, and sustainability of affordable housing projects. By adhering to these comprehensive standards and inspection protocols, participating jurisdictions can ensure that housing remains affordable, resilient, and livable for years to come.