HUD Increases New York Fair Rent Subsidies By Up to 14%; Smaller Increases in NY Metro
Real Estate In-Depth | September 7, 2022
WASHINGTON—The U.S. Department of Housing and Urban Development announced on Sept. 7 it had published Fair Market Rents (FMRs) for Fiscal Year 2023. FMRs, published annually, are an estimate of the amount of money that would cover gross rents (rent and utility expenses) on 40% of the rental housing units in an area.
Nationally, FMRs will increase by an average of approximately 10%, enabling more households with housing vouchers to access affordable, stable housing. HUD estimated that New York rent subsidies would rise up to 14%.
“One of the reasons that housing voucher holders are unable to use those vouchers is because the value of their vouchers has not kept up with rapid rent increases,” said HUD Secretary Marcia L. Fudge. “These new FMRs will make it easier for voucher holders facing this challenge to access affordable housing in most housing markets while expanding the range of housing opportunities available to households. The new FMRs reflect the reality of housing unaffordability for many households while supporting our efforts to improve affordability and accessibility for all Americans. HUD and the Biden-Harris Administration recognize the burdens of housing costs and are committed to expanding access to affordable housing through a wide range of necessary efforts, from boosting housing supply to providing more vouchers to help households with higher housing costs.”
“Rents in New York have reached an all-time high. Low-income families, who rejoiced when securing a rental assistance voucher, encountered difficulties finding units because the COVID-19 pandemic priced them out of the market,” said Alicka Ampry-Samuel, HUD Regional Administrator for New York and New Jersey. “HUD takes its responsibility to calculate the most accurate FMRs possible seriously. I look forward to seeing these families successfully securing the homes they need and the effect the improved calculations will have on hard-working HUD-subsidized families.”
For most of the market area of the Hudson Gateway Association of Realtors (Bronx, Manhattan, Rockland and Putnam), the rental subsidy will rise 4.74% or $111. Westchester County, a statutory exception area, the subsidy will rise by 7.75% or $146. Orange County HUD voucher recipients will receive a 12.11% subsidy increase of $171, while Sullivan County will see a 2.13% increase of $21.
The final Fiscal Year 2023 Fair Market Rents for the New York Metro region are: $2,123 a month for an efficiency; $2,170 for a one-bedroom unit; $2,451 for a two-bedroom; $3,078 for a three-bedroom and $3,316 for a four-bedroom apartment.
The New York, NY HUD Metro FMR Area consists of the following counties: Bronx, Kings, New York, Putnam, Queens Richmond and Rockland County. Although Westchester County is provided a separate FMR by statute, the data for Westchester County was used in computing the FMR of the New York, NY HUD Metro FMR Areas, HUD stated. The FY 2023 Fair Market Rents for New York, NY HUD Metro FMR Area are based on the results of a local rent survey conducted in November 2021.
The 2023 Fair Market Rents for Westchester County apartments are: $1,436 for an efficiency; $1,669 for a one-bedroom; $2,029 for a two-bedroom; $2,515 for a three-bedroom and $2,782 for a four-bedroom unit.
For FY23, HUD is using private sector data to estimate changes in FMRs to address a temporary data availability challenge and to align with market conditions. The basic methodology that HUD uses to estimate FMRs remains the same.
Because rents have risen so quickly recently, voucher holders are increasingly unable to find units available to rent within HUD payment standards. The new FMR levels announced today will enable the voucher program to keep up with rent increases in the private market. These new FMRs will allow voucher holders to access and secure leases in more units so that they can benefit from the housing affordability and stability that vouchers provide.
HUD is required by law to set FMRs every year. FMRs, which go into effect on October 1, are used in several HUD programs, including to determine the maximum amount that a Housing Choice Voucher will cover.
Among the initiatives the Biden Administration has enacted to assist vulnerable renters include:
• The American Rescue Plan and FY22 budget collectively provided nearly 100,000 new housing choice vouchers. This includes about 20,000 new flexible incremental housing choice vouchers that HUD expects to allocate in the coming weeks via formula to most communities across the country.
• The President’s FY23 budget proposes 200,000 additional housing vouchers.
• In June, HUD announced $43 million in FY21 funding to fund approximately 4,000 new incremental housing choice vouchers, or “Stability Vouchers,” focused on people experiencing unsheltered homelessness, including in rural areas.
• The American Rescue Plan also included $5 billion to create housing and services for people experiencing or at risk of homelessness and provided tens of billions of dollars for Emergency Rental Assistance, which improved housing stability for over six million unique households, including 700,000 HUD-assisted households.