How do rent calculations work?

Have housing for rent?

How do rent calculations work?

We calculate the tenant's rent amount based on three factors:

Tenant's income and estimated utilities (we come up with a figure for the tenant's portion based on a HUD formula)
The total rent you (the rental property owner) will be charging ("contract rent")
The Housing Commission's rent limits, based on our "Payment Standard" and other factors.

You will receive a portion of the rent from the tenant ("tenant's portion") and the balance from the Housing Commission ("Housing Assistance Payment"); these two amounts together add up to your total contract rent.

How much rent can I charge?

Contract rent limits are based on the HUD "Payment Standards" (see below) which show the total amount allowed for the contract rent plus any utilities (based on our "utilities allowance" formula) that the tenant will pay. Also, please keep in mind that the Payment Standard is only a guideline to give you an approximate idea of how much is allowed for the contract rent and utilities. The actual amount varies for each family based on rent reasonableness (as determined as part of your property inspection), the tenant's income and utility allowance. Other factors that are considered in calculating rents are:

the tenant's income (their portion of the rent can't exceed 30 - 40 percent of their income), and

"rent reasonableness" - in other words, the contract rent needs to be similar to the "going rate" for rents in the area.

Payment standard* Rental unit size (by bedroom quantity):
Single Room Occupancy studio	$ 769
Studio	$1026
One-bedroom	$1172
Two-bedroom	$1422
Three-bedroom	$2074
Four-bedroom	$2501
Five-bedroom	$2875
Six-bedroom	$3520
Mobile Home	$ 746

*Note, this is the current Payment Standard for voucher holders who are new to the program. For those moving to another unit, please see your tenant's paperwork.

Example of allowable rent: let's say you want to charge $1,000 for a two-bedroom. If that rent falls in line with standard rents in your area, and the tenant's portion is not more than 30 - 40 percent of their monthly income, that rent would be approved, assuming the tenant's utility allowance is $204 or less.

Note, if your rent is not approved because the tenant's income is too low, you might be able to still charge that rent to another (higher income) voucher-holding family.

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