You are the property manager for a HUD-subsidized apartment development. One day, the owner of the development rushes into your office, visibly frantic. The owner says, “We just received a letter from HUD’s Real Estate Assessment Center (REAC) that REAC inspectors have scheduled the property for an inspection.” You respond, “Don’t worry — with extensions we have at least 120 days before the REAC inspectors arrive.” The owner replies, “No, the inspection is scheduled 14 days from today.”
On February 20, 2019, the U.S. Department of Housing and Urban Development (HUD) announced it is drastically reducing the advance notice it provides to public housing authorities (PHAs) and private owners of HUD-subsidized apartment developments. The new notice standard is 14 calendar days – a major reduction from the 120 days HUD used to give owners and developers.
As rationale for the change, HUD expressed concern that the 120-day lead time allowed certain public housing authorities and private property owners to undertake cosmetic “just-in-time” repairs to properties rather than continuous maintenance programs. HUD Secretary Ben Carson stated in the PIH Notice release that “[i]t’s become painfully clear to us that too many landlords whom we contract with were using the weeks before their inspection to make quick fixes, essentially gaming the system.”
Secretary Carson further explained, “[t]he action we take today is part of a broader review of our inspections so we can be true to the promise of providing housing that’s decent, safe and healthy for the millions of families we serve.” To that end, HUD also announced a nationwide listening tour to gather input from the public and HUD stakeholders that is focused on a forthcoming pilot program to test new approaches to inspecting HUD-assisted properties.
How can you learn more?
If you have additional question on this topic, please reach out to the authors of this blogpost at firstname.lastname@example.org, email@example.com, or firstname.lastname@example.org. Heather Wright and Austin Holland will also be attending the Tennessee Housing Conference in Nashville on March 6 and 7, 2019. They will be available to discuss HUD’s significant reduction in advance notice for REAC inspections or other questions regarding regulatory compliance in affordable housing.