Frequently Asked Questions

Small Area Fair Market Rents | FAQ

 

On October 1, 2018, the Housing Authority of the County of San Diego (HACSD) began using Small Area Fair Market Rents (SAFMRs) to determine the payment standards applicable to the Housing Choice Voucher (HCV) program.

LANDLORD FREQUENTLY ASKED QUESTIONS (FAQS) SMALL AREA FAIR MARKET RENT

What are SAFMRs?

SAFMR stands for “Small Area Fair Market Rent.” SAFMRs are estimates of the typical rent for different unit sizes in a specific ZIP code. They are determined by the U.S. Department of Housing and Urban Development (HUD) each year, based on the distribution of all rents for standard quality housing within that ZIP code.

What are Payment Standards?

Payment standards are used to calculate the maximum subsidy the HACSD will pay toward rent and utilities for rental units leased to families with HCVs. Under the HCV program, families are generally required to pay 30 percent of their adjusted income toward rent and utilities. The HACSD then pays the difference between the family’s required contribution and the lower of (a) the payment standard and (b) the gross rent (rent plus estimated utilities) of the unit. HCV families may choose to pay more to live in a unit whose rent and utilities exceed the payment standard, but may not pay more than 40 percent of their adjusted income for rent and utilities when initially signing a lease. Effective October 1, 2018, the HACSD will use different payment standards for different ZIP codes in its jurisdiction. The payment standard will be set as a percent of the SAFMRs for that ZIP code. Owners and tenants can view the current SAFMR Payment Standards on the HACSD’s website to determine the payment standard in a particular location.

What’s New About This Approach?

Up until this year, HUD required the PHA to base payment standards on Fair Market Rents calculated for the entire metropolitan area, rather than for specific ZIP codes. This meant that payment standards may have been too low to enable HCV families to rent units in higher-cost areas and may have been higher than market rents in lower-cost areas. Under the new approach, the payment standard is based on the localized rent for each ZIP code. If your property is located in a high-cost neighborhood, it is likely that the share of the rent and utilities HACSD will pay on behalf of the tenant will increase under the new approach. At the same time, the payment standards in many low-cost areas will likely be reduced, meaning tenants may be responsible for a greater share of rent and utility payments, depending on the amount of the rent.

How will I be impacted?

The degree to which you will be impacted by the switch to SAFMRs depends on the location of the properties that you own. The change in methodology used to calculate payment standards means that families with vouchers may now be able to afford units in high-cost parts of town. If you own units in these areas, please consider opening your doors to HCV families and please continue accepting families with HCVs in all areas of HACSD’s jurisdiction. As annual reexaminations of income and eligibility for current HCV tenants are conducted, the housing assistance payment provided by the HACSD will be determined using the new payment standards. At that time, you will be given additional information about impacts on tenants who rent units in your properties.

What else do I need to know?

Please be aware that all Housing Assistance Payment contracts will remain subject to rent reasonableness determinations, including in areas where payment standards increase.

Where can I find out more information?

Attend a Landlord Meeting at the County of San Diego’s Housing and Community Development Services located 3989 Ruffin Road, San Diego, CA 92123.  Please check the website http://sdhcd.org for the dates and time of upcoming meetings.  You may also contact your tenant’s Housing Representative.

 

TENANT FREQUENTLY ASKED QUESTIONS (FAQS) SMALL AREA FAIR MARKET RENT

What are SAFMRs?

SAFMR stands for “Small Area Fair Market Rent.” SAFMRs are typical rent levels (including the cost of utilities, except telephone), within a ZIP code, for rental units with different numbers of bedrooms. SAFMRs are established by the U.S. Department of Housing and Urban Development (HUD) each year.

What are Payment Standards?

Payment standards are used to calculate the maximum subsidy that the HACSD will pay for your rental unit. Under the HCV program, you are generally required to pay 30 percent of your adjusted income for rent and utilities. The HACSD then pays the difference between your required contribution and either (a) the payment standard or (b) the gross rent (rent plus estimated utilities) of the unit – whichever is lower.

Effective October 1, 2018, the HACSD began using different payment standards for different ZIP codes in its jurisdiction. You can use the SAFMR Payment Standard Chart to determine the payment standard in any neighborhood.

What’s New About This Approach?

Until now, the amount the HACSD would pay toward rent for families with vouchers was based on rental rates across the entire metropolitan area. The new approach uses the localized rent in each ZIP code (the SAFMR) to determine how much assistance families with vouchers are eligible to receive. Use of this new approach is required by HUD for all PHAs in the San Diego area.

How will I be impacted?

As a voucher family, you will still be able to choose the unit that meets your needs (subject to HACSD requirements). However, you will be able to use your voucher in more places than would have been possible before – including neighborhoods with higher rents that may have high-performing schools, low levels of poverty, and access to grocery stores, parks, and other amenities. If you choose to rent in a high-cost neighborhood, you will likely receive more assistance toward rent and utilities than you would have under the old approach. If you choose to rent in a neighborhood where rents are low, you may receive less assistance toward rent and utilities under the new approach.

Please note that if you are currently leased, you do not need to move. 

  • If payment standards are increased in the zip codes where you live, the portion of the rent for which you are responsible may be reduced and the HAP increased at the next annual recertification.
  • If payment standards are reduced in the zip code where you live, the Housing Assistance Payment (HAP) your landlord receives may go down and you may be responsible for a larger share of the rent.  Families currently under contract will not be subject to any applicable reductions in payment standard until their second annual reexamination after a reduction in the payment standards.
  • Any changes in your current rent portion payments will be clearly communicated to you in advance of the effective date.

If you choose to move, you will have the option to relocate at the end of your lease term, provided that you are in compliance with the terms of the lease agreement and with Section 8 HCV program requirements.  If you move, the SAFMR for that ZIP code will apply.

Where can I find out more information?

Contact your assigned Housing Representative or attend an upcoming Tenant Meeting at the County of San Diego’s Housing and Community Development Services located 3989 Ruffin Road, San Diego, CA 92123.  Please check the website http://sdhcd.org for the dates and time of upcoming meetings.  The Tenant Meetings will show you how to search for available rentals and how to estimate how much rent assistance you will receive and how much rent you will pay in different units.