Report Explores How Small Area FMRs Would Affect Availability of Homes Affordable to Voucher Holders
A report released today by the NYU Furman Center explores the potential impact of Small Area Fair Market Rents (“Small Area FMR”) in 24 metros. The report, "How Do Small Area Fair Market Rents Affect the Location and Number of Units Affordable to Voucher Holders?," summarizes the history of HUD’s Small Area FMR rule and analyzes how housing availability in 24 metro areas would be affected by the mandated change.
In November of 2016, the U.S. Department of Housing and Urban Development issued a final rule mandating the use of Small Area Fair Market Rents (FMRs) in 24 metropolitan areas as a strategy to allow housing choice voucher holders to rent homes in a wider variety of areas. HUD selected these 24 metropolitan areas because they deemed that these were areas where Small Area FMRs would be likely to expand choices for voucher holders. In August of 2017, HUD announced it was delaying the mandatory implementation of Small Area FMRs for two years, in part due to a concern that the number of homes affordable to voucher holders would fall under Small Area FMRs.
The NYU Furman Center analysis finds that, in aggregate, the number of units affordable to voucher holders would increase by more than nine percent under Small Area FMRs. However, the impact of shifting to Small Area FMRs varies across the 24 markets potentially affected by the rule.
Twenty metros are likely to see an increase in the number of available units, while four metropolitan areas (Monmouth-Ocean, New Jersey; Gary, Indiana; Hartford-West Hartford-East Hartford, CT; and North Port-Sarasota-Bradenton, FL) may experience a small reduction—less than five percent—in the number of affordable units. Still, the authors point out that the analysis does not take into consideration strategies offered by HUD to local authorities to mitigate such potential impacts.