HOUSING

Study of private multifamily rental properties
Department of Housing and Urban Development

HUD provides rental subsidies and mortgage insurance to the owners of private multifamily rental properties. Roughly 1.5 million units of this HUD-assisted rental housing were developed from the 1960s through the early 1980s. Several types of incentives and financial assistance were provided to the private developers of multifamily housing in exchange for an agreement to rent the housing to low- and moderate-income households at affordable rents. One such incentive was an owner’s ability to either prepay a subsidized mortgage (under the older mortgage subsidy programs) after 20 years, or simply not renew Section 8 subsidies when those subsidy contracts expired and convert the properties to another use. Many owners of this housing have chosen to opt-out of their commitment and not renew expiring contracts.

Econometrica, in partnership with Abt Associates, is examining the experience of these “opt-out” properties and comparing them with properties that have remained in the HUD programs. The study will also examine the types of owners that opt out and how they arrived at that decision, and assess whether the rents at properties whose owners have opted out remain affordable.