The
U.S. Department of Housing and Urban Development (HUD) recently announced
changes to the Federal Housing Administration's (FHA's) condominium approval
policies. Among other adjustments, HUD altered its policies
governing the maximum levels of delinquency and leasing in FHA-approved
condominiums.
Under
the new FHA standards, no more than 15% of the total units in a condominium can
be more than 60 days past due on assessment payments. This percentage
includes units that are occupied, bank-owned, or vacant. HUD warned that
it will not grant exceptions to this rule.
The
new FHA standards retain the requirement for completed condominiums that are
over a year old to be at least 50% owner-occupied. For condominium
projects that are proposed, under construction, or less than a year old,
however, HUD now requires a minimum owner-occupancy percentage equal to 30% of
the condominium’s declared units.
HUD's letter describing the complete set of changes to the FHA condominium
approval policies can be found here.
