7.7.1.1 Rent Comparables

A. Market rent by comparison shall be estimated by the appraiser and documented on form HUD-92273 or form HUD-92273-S8 if the appraisal is also being used as a Rent Comparability Study (RCS). A separate form HUD-92273 is to be prepared for each type and size of rental unit in the subject project (if significantly different).

B. Market rents attributed to the subject property should not be speculative. If rents are based on levels achievable assuming that proposed repairs are completed, then those units that have had repairs completed and are leased are most reflective of market or near market rent levels. The rent comparables and units selected for comparison must be as similar as possible to the subject project and units as to location, structural type, number of bedrooms, and average unit size. In order to ensure they are truly comparable and competitive with the subject project, appraisers should generally not use rent comparables located outside of the subject’s market area, instead they should be from areas similar to the subject and should be fully explained in the report. Market-rate units from partially assisted projects can be used as rental comparables in the absence of better rental data.