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Administrative Plan 7/1/2025 <br />. <br />Page 8-28 <br />PART III: RENT REASONABLENESS [24 CFR 982.507] <br />8-III.A. OVERVIEW <br />Except in the case of certain LIHTC- and HOME-assisted units, no HAP contract can be <br />approved until the PHA has determined that the rent for the unit is reasonable. The purpose of <br />the rent reasonableness test is to ensure that a fair rent is paid for each unit rented under the HCV <br />program. <br />HUD regulations define a reasonable rent as one that does not exceed the rent charged for <br />comparable, unassisted units in the same market area. HUD also requires that owners not charge <br />more for assisted units than for comparable units on the premises. This part explains the method <br />used to determine whether a unit’s rent is reasonable. <br />PHA-Owned Units [24 CFR 982.352(b)] <br />In cases where an HCV family is receiving assistance in a PHA-owned unit, the PHA must <br />obtain the services of an independent entity to determine rent reasonableness in accordance with <br />program requirements, and to assist the family in negotiating the contract rent when the family <br />requests assistance. A PHA-owned unit is defined as a unit that is owned by the PHA that <br />administers the assistance under the consolidated ACC (including a unit owned by an entity <br />substantially controlled by the PHA). The independent agency must communicate the results of <br />the rent reasonableness determination to the family and the PHA. The independent agency must <br />be approved by HUD, and may be the unit of general local government for the PHA jurisdiction <br />(unless the PHA is itself the unit of general local government or an agency of such government). <br />EXHIBIT 1