lis 217 stemming the tide - LISC

Local Use and Regulatory RestrictionsAre there any local or state restrictions associatedwith the property that would limit its useafter federal restrictions expire? If so, the property'smarket value and conversion potential—as well as its ability to Mark-Up-to-Market 45 —could be affected. Common types of state/localuse restrictions include:Urban Renewal. For properties located in anurban renewal area, there may be deedcovenants or affordable housing requirementsassociated with the parcel or with the renewalplan in general.Tax Relief. The property may have received propertytax relief or other favorable tax treatment inexchange for its use as affordable housing.Public Financing. The property may havereceived state or local financing or subsidies inexchange for its use as affordable housing.Rent Control. The property may be subject torent or condominium conversion controls.Zoning Relief. Variances, special permits, orother forms of zoning relief may have beengranted for the original construction or substantialrehabilitation that require continued use ofthe property as affordable housing.MARKET INFORMATION SOURCESRent Comparability Studies. For almost all Section 8 properties, HUD requires owners to submit a rent comparabilitystudy when the original Section 8 contract expires, upon contract renewal under MAHRA—andevery five years thereafter. Section 8 projects whose contracts have not yet expired, but which are subject toAAF rent adjustments, must submit an annual market study if the owner wants to increase rents. Rent comparabilitystudies are not available from HUD under FOIA but can sometimes be obtained directly from theowner, or through a friendly state or local public agency.Market Data. Brokers, realtors, assessors, and other knowledgeable local sources can provide a good senseof the local housing market. The local housing authority should have data on Section 8 voucher utilization.Local Use Restrictions. Local planning, redevelopment, and housing agencies are good sources for neighborhoodplanning information and documents pertaining to state or local restrictions. Recorded restrictions canbe found at the Registry of Deeds.Appraisals. The owner may be willing to share a property appraisal. Prospective purchasers of subsidizedproperties may want to commission an independent appraisal before making a purchase offer.33chapter four: Researching the Property: Towards a Preservation Strategy 37