Just Released: 2004 Fair Market Rents

Final FY 2004 Fair Market Rents are now available.

Effective October 1, the final Fair Market Rents (FMRs)
for FY 2004 have taken effect, and are being used to
determine standard payment amounts for the Housing Choice
Voucher program, renewal rents for some expiring project-
based Section 8 contracts, and to determine initial rents
for housing assistance programs (HAPs).

Housing assistance payments are limited by FMRs, which
are established by HUD for different areas. In the
Housing Choice Voucher program, the FMR is used to
determine the "payment standard amount" used to calculate
the maximum monthly subsidy for an assisted family. In
general, the FMR for a given area is the amount that
would be needed to pay the gross rent (shelter rent plus
utilities) of privately-owned, decent, and safe rental
housing of a modest (non-luxury) nature with suitable
amenities.

FMRs are set at a percentile within the rental
distribution for standard quality rental housing in each
area. The rents must be high enough to allow the assisted
recipient some selection in housing, yet low enough to
serve as many families as possible. The FMRs are based on
the distribution of rents for units that are occupied by
recent movers. Units that are less than two years old and
public housing units are not included in the
distribution.

HUD sets FMRs either at the 40th or 50th percentile rent.
For most FMR areas, the FMR is set at the 40th percentile
rent paid by recent movers, which means that 40 percent
of all standard quality rental housing units rented
within the past 18 months have rents at or below this
dollar amount. For some areas, the FMR is set at the 50th
percentile rent or the median rent, so that 50 percent of
standard units are at or below this dollar amount.
Currently, 39 FMR areas are set at the 50th percentile
rent.

HUD uses four data sources to develop the FMRs. These
include the 1990 Census, which provides statistically
reliable rent data for all FMR areas; the American
Housing Surveys (AHS) conducted after 1990, which are
done for the largest metropolitan areas and which have an
accuracy comparable to the decennial Census; Random Digit
Dialing (RDD) telephone surveys of individual FMR areas,
which are based on a sampling procedure that uses
computers to select statistically random samples of
rental housing; and data from the 2000 Census, which were
used for a small number of metropolitan areas that had
submitted public comments requesting higher FMRs and
where 2000 Census data showed FMRs were significantly
understated.

To see the Federal Register notice with the fiscal year
2004 Fair Market Rents, visit
https://www.huduser.gov/Datasets/fmr.html.
--------------------------------------
Please contact HUD USER at:
HUD USER
P.O. Box 23268
Washington, DC 20026-3268
1-800-245-2691
1-800-927-7589 (TDD)
202-708-9981 (fax)
--------------------------------------
The HUD USER News listserv was created to keep
professionals in the fields of housing and community
development abreast of new research and resources
available from the U.S. Department of Housing and Urban
Development's Office of Policy Development and Research
(PD&R). Periodically, publications and announcements will
be sent via the listserv.

Share HUD USER's resources and information with a
colleague. Please consider forwarding this e-mail to an
associate who may be interested in the resources HUD USER
has to offer. Thanks!

To stay abreast of new HUD research and resources,
subscribe to HUD USER News. This listserv will
automatically e-mail you publication announcements and
other notices from HUD's Office of Policy Development and
Research. To subscribe, send a message to:
hudusernews@huduser.gov. In the subject of the message,
type: subscribe. For example:
To: hudusernews@huduser.gov
Subject: subscribe

You will receive a confirmation message with instructions
on how to post messages to the list, search the message
archives, and how to unsubscribe. You may use your web
browser to search the listserv message archives at
https://www.huduser.gov/portal/elist/archive.html