9-1. BACKGROUND

A. For HAP contracts renewed under Options One, Two, and Three, MAHRA requires that the renewal rents be based on the comparable market rents for the market area.[1] A RCS is used in determining the comparable market rents for each unit type covered under a HAP contract.

B. Contract rents are estimated based on rents paid at comparable properties. The term “comparable properties” is defined in MAHRA as properties in the same market areas, where practicable, that (1) are similar “as to neighborhood (including risk of crime), type of location, access, street appeal, age, property size, apartment mix, physical configuration, property and unit amenities, utilities, and other relevant characteristics”; and (2) “not receiving project-based assistance.”[2]

C. To prepare an RCS, an appraiser analyzes the subject property, identifies comparable properties, and determines the rents paid at such properties.[3] The appraiser then makes adjustments to these rents based on differences between the comparable properties and the subject property to arrive at estimated market rents.