RENT INCREASES AND HOUSING ASSISTANCE PAYMENTS
Eligibility for a Rent Increase
HACCC must process and approve any rent increase or changes in utility responsibilities for HCV Program participants before they are implemented. Property owners are eligible to request a rent increase to go into effect any time after the end of a lease term (normally 12 months but no more than two years). To account for HACCC processing and proper tenant notification, property owners should submit rent increase requests 60 days prior to the date that they want the increase or utility change to go into effect.
Example 1: If the lease term ends on April 30, a property owner can request a rent increase as early as March 1 (60 days before the increase can go into effect on May 1).
Example 2: A property owner requests a rent increase on March 1, 2018 to go into effect on May 1, 2018. The request is approved and a two-year lease agreement is signed with the participant for the increased amount. As the lease has a two-year term, the property owner will not be eligible to request a rent increase in 2019 and must wait until March 1, 2020 to request an increase (60 days before the increase can go into effect).
Determining a Rent Increase Amount
A rent increase request triggers HACCC to perform a new rent determination, including a new rent reasonableness study of the market. This process takes approximately 30 days. If a rent amount change is approved, HACCC will issue an updated Rent Adjustment Letter to both the participant and property owner, listing the new Contract Rent amount (tenant portion + Housing Assistance Payment (HAP) amount) and the effective date of the change (typically 30 days out). If the request required a change in utility responsibility, HACCC will contact the property owner to sign a new HAP Contract and submit a new lease reflecting the change.
Unlike the new-move rent determination, HACCC does not take the participant’s affordability into account when processing the rent increase. As a result, the participant, not HACCC, will most likely be responsible for paying the difference if a rent increase is approved. If the participant does not wish to absorb the increase, they may submit a Notice of Intent to Vacate to begin the move process (see “Moving” page for more information).
Important items to consider:
Requesting a rent increase triggers HACCC to perform a new rent determination. If HACCC determines that your market value has decreased, the Contract Rent could possibly be lowered accordingly. Therefore, it’s extremely important to do your due diligence and research the market before submitting a rent increase request.
- Even if the property owner and participant mutually agree to change who is responsible for paying any utilities, the property owner must submit a rent adjustment request that details the new utility responsibilities and this must be approved by HACCC before the change can go into effect. A new HAP Contract and lease will be required for any change in utility responsibilities.
- Rent increases will not be approved if any failed items identified by the most recent HQS inspection have not been corrected or if the regular inspection is due prior to the effective date of the rent increase and had not yet passed.
- Participants should not pay an increased rent amount or sign a new lease agreement accepting a rent increase or change in utility responsibilities until the rent increase request has been approved by HACCC and a new Rent Adjustment Letter has been issued outlining the new tenant portion and HAP amount.