Recent News

FHA Improves Condo Rules, However, More is Needed, C.A.R. Says

The U.S. Department of Housing and Urban Development (HUD) announced that the Federal Housing Administration (FHA) will lower its owner occupancy requirements on certain condominium developments from 50 percent to 35 percent, provided the project meets certain conditions, effective immediately.

“C.A.R. has been working with HUD for many years in an effort to lower condominium occupancy requirements for FHA financing approval, and while it’s a step in the right direction, we don’t believe it will significantly help condo developments in struggling neighborhoods that need it most,” said C.A.R. President Pat “Ziggy” Zicarelli.

Under the new provisions, FHA approved condominium projects require at least 50 percent of the units to be owner-occupied, but will allow for the owner-occupancy requirement to be lowered down to 35 percent if:

• The project has replacement reserves of at least 20 percent of the budget,
• No more than 10 percent of the units are in arrears (more than 60 days past due), and
• The condo has three years of acceptable financial documents.