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PHA- and HUD-Initiated Rent Reasonableness Determinations HUD requires SARA to make a determination of rent reasonableness (even if the owner has not requested a change) if there is a 5 percent decrease in the Fair Market Rent that goes into effect at least 60 days before the contract anniversary date. HUD also may direct SARA to make a determination at any other time. SARA may decide that a new determination of rent reasonableness is needed at any time. In addition to the instances described above, SARA will make a determination of rent reasonableness at any time after the initial occupancy period if: (1) SARA determines that the initial rent reasonableness determination was in error or (2) SARA determines that the information provided by the owner about the unit or other units on the same premises was incorrect. (3) Changes in the current rental market. 8-III.C. HOW COMPARABILITY IS ESTABLISHED Factors to Consider HUD requires PHAs to take into consideration the factors listed below when determining rent comparability. SARA may use these factors to make upward or downward adjustments to the rents of comparison units when the units are not identical to the HCV-assisted unit. • Location and age • Unit size including the number of rooms and square footage of rooms • The type of unit including construction type (e.g., single family, duplex, garden, low-rise, high-rise) • The quality of the units including the quality of the original construction, maintenance and improvements ma e. • Amenities, services, and utilities included in the rent Units that Must Not be Used as Comparables Comparable units must represent unrestricted market rents. Therefore, units that receive some form of federal, state, or local assistance that imposes rent restrictions cannot be considered comparable units. These include units assisted by HUD through any of the following programs: Section 8 project-based assistance, Section 236 and Section 221(4)(3) Below Market Interest Rate (BMIR) projects, HOME or Community Development Block Grant (CDBG) program- assistedunits in which the rents are subsidized; units subsidized through federal, state, or local tax credits; units subsidized by the Department of Agriculture rural housing programs, and units that are rent-controlled by local ordinance. 1Vote: Notice PIH 2010-18, issued May 10, 2010, provides further guidance on the issue of what constitutes an assisted unit. ~~02~12 Page 8-14