The Best Laid Plans Often Go Awry: An Analysis of the Implementation of Small Area Fair Market Rents

Kelly L. Patterson
Robert Mark Silverman
University at Buffalo

The U.S. Department of Housing and Urban Development’s (HUD) new Small Area Fair Market Rents (SAFMRs) rule sets fair market rents at the ZIP Code level as opposed to an entire metropolitan region. The rule became effective on January 1, 2018. It is mandatory in 24 metropolitan areas and voluntary in the other metropolitan areas across the United States. SAFMRs allow for housing choice voucher (HCV) payment standards to vary across ZIP Codes within a region. This is a change from previous policy that based Fair Market Rents (FMRs) on the 40th percentile of gross rents in a region. This change opens properties in higher income areas to HCV holders because rents at the ZIP Code level often exceed regional FMRs. The use of SAFMRs is predicted to help to deconcentrate poverty and allow HCV holders to access high opportunity neighborhoods in core cities and their suburbs. SAFMRs have the potential to curb some of the effects of increasing rents in places experiencing gentrification, as well as promote housing mobility and fair housing across regions. This article examines the early implementation strategies for SAFMRs in the 24 metropolitan areas where they are currently mandated. Data were collected from the 180 public housing authorities (PHAs) in those 24 metropolitan areas. The analysis is based on 2018 HCV payment standards and other program documents related to tenant and landlord notification collected from PHAs, as well as content analysis of archival materials and public documents. The analysis is used to measure PHA fidelity to the SAFMR rule’s opportunity advancement goals, identify best practices, and make policy recommendations for the broader implementation of SAFMRs.