Notice2026-07176
National Standards for the Physical Inspection of Real Estate: Implementation Guidance and Inspection Standards for the HOME Investment Partnerships and Housing Trust Fund Programs
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
April 14, 2026
Effective
October 1, 2023
Issuing agencies
Housing and Urban Development Department
Abstract
This notice serves as guidance to the "Economic Growth Regulatory Relief and Consumer Protection Act: Implementation of National Standards for the Physical Inspection of Real Estate" (NSPIRE) rule published May 11, 2023. The rule provided that HUD publish in the Federal Register an additional notice on the NSPIRE Standards for the HOME Investment Partnerships (HOME) and Housing Trust Fund (HTF) programs. In addition, this notice implements the property standards and inspection provisions in the "HOME Investment Partnerships Program: Program Updates and Streamlining" rule published on January 6, 2025. This notice also provides guidance to HOME participating jurisdictions and HTF grantees on how to develop HOME and HTF written property standards and inspect assisted projects in compliance with the NSPIRE final rule and the HOME final rule, as applicable.
Full Text
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<title>Federal Register, Volume 91 Issue 71 (Tuesday, April 14, 2026)</title>
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[Federal Register Volume 91, Number 71 (Tuesday, April 14, 2026)]
[Notices]
[Pages 19145-19195]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-07176]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-6504-N-01]
National Standards for the Physical Inspection of Real Estate:
Implementation Guidance and Inspection Standards for the HOME
Investment Partnerships and Housing Trust Fund Programs
AGENCY: Office of the Assistant Secretary for Community Planning and
Development (CPD), U.S. Department of Housing and Urban Development
(HUD).
ACTION: Notice.
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SUMMARY: This notice serves as guidance to the ``Economic Growth
Regulatory Relief and Consumer Protection Act: Implementation of
National Standards for the Physical Inspection of Real Estate''
(NSPIRE) rule published May 11, 2023. The rule provided that HUD
publish in the Federal Register an additional notice on the NSPIRE
Standards for the HOME Investment Partnerships (HOME) and Housing Trust
Fund (HTF) programs. In addition, this notice implements the property
[[Page 19146]]
standards and inspection provisions in the ``HOME Investment
Partnerships Program: Program Updates and Streamlining'' rule published
on January 6, 2025. This notice also provides guidance to HOME
participating jurisdictions and HTF grantees on how to develop HOME and
HTF written property standards and inspect assisted projects in
compliance with the NSPIRE final rule and the HOME final rule, as
applicable.
DATES: HUD's National Standards for the Physical Inspection of Real
Estate (NSPIRE) final rule for Community Planning and Development (CPD)
programs was effective October 1, 2023. In accordance with HUD's
Federal Register notice published at 89 FR 55645, the compliance date
was extended until October 1, 2025, and subsequently HUD's Federal
Register notice at 90 FR 46912 further extended the compliance date to
October 1, 2026. The HOME final rule was effective on February 5, 2025,
with a one-year compliance period. However, HUD's Federal Register
notice delayed the effective date of the 2025 HOME final rule until
April 20, 2025, with a one-year compliance period. This notice aligns
and extends the compliance dates of the NSPIRE final rule and the
updated property standards and inspection requirements in the 2025 HOME
final rule for jurisdictions and participants, in the HOME program, and
extends the compliance date of the NSPIRE final rule for grantees in
the HTF program until April 14, 2027. For all activities with written
agreements executed prior to the compliance date, participating
jurisdictions and grantees may continue to comply with the previous
standards as defined in the HOME and HTF regulations at 24 CFR parts 92
and 93, respectively.
FOR FURTHER INFORMATION CONTACT: Caitlin Renner, Acting Director,
Program Policy Division, Department of Housing and Urban Development,
2415 Eisenhower Avenue, Alexandria, VA 22314; email <a href="/cdn-cgi/l/email-protection#c689878e9686aeb3a2e8a1a9b0"><span class="__cf_email__" data-cfemail="fbb4bab3abbb938e9fd59c948d">[email protected]</span></a> or
telephone (202) 708-2684. (This is not a toll-free number.) HUD
welcomes and is prepared to receive calls from individuals who are deaf
or hard of hearing, as well as individuals with speech or communication
disabilities. To learn more about how to make an accessible telephone
call, please visit: <a href="https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs">https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs</a>.
SUPPLEMENTARY INFORMATION:
I. Previous Standards
Prior to implementation of the NSPIRE rule, there were two
inspection models used and referenced in the HOME and HTF regulations:
the Housing Quality Standards (HQS), which were found at 24 CFR 982.401
and were applicable to units occupied by tenants receiving HOME tenant
based rental assistance; and the Uniform Physical Condition Standards
(UPCS), which were found at 24 CFR 5.703 with the dictionary of
individual UPCS deficiencies contained in a Federal Register notice.
The HOME and HTF regulations at 24 CFR parts 92 and 93, respectively,
applied HQS to units occupied by tenants receiving HOME tenant based
rental assistance (TBRA) and UPCS to the development of written
property standards for HOME and HTF rehabilitation and/or acquisition
activities and ongoing compliance of assisted rental housing.
II. This Notice
On May 11, 2023, HUD published the final rule ``Economic Growth
Regulatory Relief and Consumer Protection Act: Implementation of
National Standards for the Physical Inspection of Real Estate'' (88 FR
30442) to align expectations of housing quality and consolidate
inspection standards across HUD programs. On January 6, 2025, HUD
published ``HOME Investment Partnerships Program: Program Updates and
Streamlining'' (90 FR 746) (2025 HOME final rule) which provides
additional physical condition requirements and flexibilities for
inspections of HOME-assisted projects.
Consistent with the preamble to the final rule and the conforming
changes at 24 CFR parts 92 and 93 and additional updates in the 2025
HOME final rule, HUD is publishing this Federal Register notice to
address implementation of NSPIRE in the HOME and HTF programs. This
notice clarifies applicable HOME and HTF property standards
requirements and establishes the specific deficiencies that must be
corrected in HOME- and HTF-assisted housing projects based on the
unified NSPIRE Standards established in the ``National Standards for
the Physical Inspection of Real Estate: Inspection Standards'' notice
(NSPIRE Standards notice) (88 FR 40832) published on June 22, 2023. The
NSPIRE Standards replace both the UPCS and the HQS. Furthermore, the
NSPIRE rule and standards were subject to extensive industry and public
input and the standards will be updated through Federal Register
notices at least every three years in accordance with 24 CFR
5.709(a)(1). Accordingly, HUD will also periodically update program-
specific guidance for HOME and HTF to align with changes to NSPIRE,
published on June 22, 2023.
III. Effective Date and Applicability
The NSPIRE final rule is effective for projects to which HOME or
HTF funds are committed on or after the effective date of October 1,
2023. However, participating jurisdictions and grantees are not
required to comply with changes in the NSPIRE rule until the compliance
date. In accordance with the ``Economic Growth Regulatory Relief and
Consumer Protection Act: Implementation of National Standards for the
Physical Inspection of Real Estate (NSPIRE); Extension of NSPIRE
Compliance Date for HCV, PBV, Section 8 Moderate Rehab and CPD
Programs'' (89 FR 55645), the compliance date was extended until
October 1, 2025. Subsequently, HUD's notice at 90 FR 46912 further
extended the compliance date to October 1, 2026. The HOME final rule
was effective on February 5, 2025, with a one-year compliance period.
However, the notice delayed the effective date of the 2025 HOME final
rule until April 20, 2025, with a one-year compliance period. Due to
the delay in publication of this notice, the compliance date for HOME
and HTF is further extended to 365 days from the publication of this
notice.
To implement the requirements described in this notice, it will be
necessary for participating jurisdictions and grantees to make
extensive revisions to their written rehabilitation and/or property
standards and to train local inspectors on such policies. Consequently,
HUD has determined that participating jurisdictions and grantees
require at least 12 months for implementation before compliance is
possible. Therefore, for all activities with written agreements
executed prior to the compliance date, participating jurisdictions and
grantees may continue to comply with the previous standards as defined
in the HOME and HTF regulations at 24 CFR parts 92 and 93,
respectively.
NSPIRE is only applicable to HOME- and HTF-assisted projects with
new commitments made on or after the effective date. Because
participating jurisdictions and grantees are required to manage the
day-to-day operations of their programs in accordance with all program
requirements and written agreements as required for HOME and HTF at 24
CFR 92.504(a) and 93.404(a), respectively, new regulatory requirements
cannot be imposed on project owners unless permitted by the project
written agreement. However, HUD encourages participating jurisdictions
and grantees to standardize
[[Page 19147]]
ongoing rental property standards across their portfolio of projects.
Before imposing NSPIRE on projects for which funding commitments were
made prior to the effective date of the NSPIRE final rule,
participating jurisdictions and grantees must determine whether the
existing project written agreement automatically adopts HOME and/or HTF
regulatory changes or if the agreements must be amended to apply NSPIRE
requirements in accordance with any applicable amendment clauses.
IV. NSPIRE Conforming Changes to the HOME and HTF Regulations
The conforming language in the HOME and HTF regulations make
several notable changes to the program requirements. First, HUD
clarified that ``decent, safe, and sanitary'' as referenced in Section
211 of the HOME statute, Title II of the Cranston-Gonzalez National
Affordable Housing Act of 1990, as amended (42 U.S.C. 12701 et seq.),
and ``decent, safe, sanitary, and in good repair'' as referenced in 24
CFR parts 92 and 93 means in compliance with the national standards for
the condition of HUD housing at 24 CFR 5.703, which requires that all
residents live in safe, habitable dwellings. Furthermore, the
definition of ``Uniform Physical Condition Standards at 24 CFR 92.2 and
93.2 were removed from the regulations and all references to UPCS were
replaced with NSPIRE.
Additionally, the HOME and HTF programs apply the requirements at
24 CFR 5.703 and the conforming amendments make clear that
participating jurisdictions and grantees are not subject to the
requirements at 24 CFR 5.705 through 5.713, which include, but are not
limited to, the NSPIRE inspection procedures, administrative processes,
and the scoring and ranking, and appeals processes. These procedural
requirements are generally applicable to inspections under various
programs overseen by the HUD Office of Multifamily Housing and Public
and Indian Housing but do not apply to HOME and HTF.
The conforming amendments in HOME and HTF at 24 CFR 92.251 and
93.301 apply the affirmative requirements at 24 CFR 5.703 to
rehabilitation projects with two exceptions. First, the carbon monoxide
detection requirements at 24 CFR 5.703(b) and (d) do not apply at this
time. These requirements were added to the NSPIRE final rule after the
public comment period to comply with statutory provisions imposed on
several HUD programs but not the HOME or HTF programs. Consequently,
HUD will address carbon monoxide detection requirements in future HOME
and HTF rulemaking to provide the public with an opportunity to
comment. In the meantime, HUD reminds participating jurisdictions and
grantees that they must comply with state or local carbon monoxide
detection requirements and strongly encourages participating
jurisdictions and grantees to incorporate carbon monoxide detection
requirements in their written property standards, even when not
required by code or HUD regulation.
The second exception is for single room occupancy (SRO) housing.
SRO housing projects are only required to comply with 24 CFR 5.703(d),
which outlines affirmative requirements for the unit, to the extent
that those components exist within the unit. For example, the HOME and
HTF definitions of SRO housing do not require that SRO units contain
both kitchen and sanitary facilities. In the case of new construction,
one or the other is required, and for rehabilitation or acquisition
projects neither component is required within an SRO unit. When a
participating jurisdiction or grantee is constructing or rehabilitating
an SRO unit in compliance with the program regulations and the
component is not present in the SRO housing unit, the SRO housing unit
is not required to comply with the provisions of 24 CFR 5.703(d)(1)
that address the missing components. These provisions require that the
unit must have hot and cold running water in both the bathroom and
kitchen, including an adequate source of safe drinking water in the
bathroom and kitchen.
Similarly, participating jurisdictions and grantees will not be
required to comply with the requirements at 24 CFR 5.703(d)(4) that the
unit contain a kitchen area with a sink, cooking appliance,
refrigerator, food preparation area, and food storage area apply for
the missing components. Lastly, the participating jurisdictions and
grantees will not be required to comply with 24 CFR 5.703(d)(2), which
requires the unit to include its own bathroom or sanitary facility--
containing a sink, a bathtub or shower, and an interior flushable
toilet--that is in proper operating condition and usable in privacy.
However, if the SRO unit has kitchen and/or sanitary facilities, the
NSPIRE standards apply to those components.
For rehabilitation and acquisition of standard housing projects,
the regulations now provide that HUD must establish lists of specific
deficiencies, which must not exist in HOME- or HTF-assisted housing
upon project completion. The specific deficiency lists must be based on
the national standards for the condition of HUD housing at 24 CFR
5.703, and HUD must publish them in the Federal Register.
Because the previous version of the HOME rule applied HQS to units
occupied by tenants receiving HOME TBRA, the conforming changes are
significant for TBRA programs. The rule requires that a participating
jurisdiction establish written property standards for a HOME TBRA
program, which at a minimum must comply with federal lead-based paint
requirements, and with state and local codes and ordinances, including
those for health and safety. In the absence of state or local
habitability or property condition codes, a participating
jurisdiction's TBRA property standards must provide that the project
will not contain specific deficiencies established by HUD. Similarly,
the rule requires that participating jurisdictions require that HOME-
assisted rental housing comply with state and local codes and
ordinances during the period of affordability, and in the absence of
such codes and ordinances the housing must not contain the specific
deficiencies established by HUD.
The HTF regulations are slightly different in that they require
that at a minimum, the grantee's ongoing property standards for rental
housing during the period of affordability must provide that the
property does not contain the specific deficiencies established by HUD
whether or not state or local codes apply.
The specific deficiency lists for all applicable HOME and HTF
activities must be based on the national standards for the condition of
HUD housing at 24 CFR 5.703, and HUD must publish them in the Federal
Register.
Finally, for ongoing inspections of HTF-assisted rental properties
during the period of affordability, the inspection requirements at
93.404(d) require HUD to set forth guidance that explains ``a
statistically valid sample of units appropriate to the size of the HTF-
assisted project.''
V. Affirmative Requirements
Affirmative requirements are the basic requirements that must be
met for HOME- and HTF-assisted housing in accordance with the NSPIRE
rule. There are additional requirements contained in 24 CFR 92.251 that
apply to HOME units pursuant to the 2025 HOME final rule. These
requirements will be described later in this Notice. The NSPIRE rule
provides the minimum, or affirmative, habitability requirements for
each inspectable area at 24 CFR
[[Page 19148]]
5.703(b), (c), and (d) (inside, outside, and unit). Affirmative
requirements are designated as pass or fail during an inspection. The
affirmative requirements for each inspectable area applicable to the
HOME and HTF programs are as follows:
A. Inside (24 CFR 5.703(b))--the common areas and building systems
within the building interior and are not inside a unit:
1. The inside area must include at least one battery-operated or
hard-wired smoke detector, in proper working condition, on each level
of the property.
2. For the inside area, any outlet installed within six feet of a
water source must be a ground-fault circuit interrupter (GFCI)
protected.
3. The inside area must have a guardrail when there is an elevated
walking surface with a drop of 30 inches or greater measured
vertically.
4. The inside area must have permanently mounted light fixtures in
any kitchen and each bathroom.
5. The inside area may not contain unvented space heaters that burn
gas, oil, or kerosene.
B. Outside (24 CFR 5.703(c))--the building site, building exterior
components, and any building systems located outside of the building or
unit:
1. For the outside area, outlets within six feet of a water source
must be GFCI protected and;
2. The outside area must have a guardrail when there is an elevated
walking surface with a drop of 30 inches or greater measured
vertically.
C. Unit (24 CFR 5.703(d))--the interior components of an individual
dwelling where the resident lives:
1. The unit must have hot and cold running water in both the
bathroom and kitchen, including an adequate source of safe drinking
water in the bathroom and kitchen.
2. The unit must include its own bathroom or sanitary facility that
is in proper operating condition and usable in privacy. It must contain
a sink, a bathtub or shower, and an interior flushable toilet.
3. The unit must meet the below standards or follow the
specifications of National Fire Protection Association (NFPA) 72, which
satisfies the affirmative requirements for smoke detectors.
a. The unit must include at least one battery-operated or hard-
wired smoke detector, in proper working condition, in the following
locations:
<bullet> On each level of the unit.
<bullet> Inside each bedroom.
<bullet> Within 21 feet of any door to a bedroom measured along a
path of travel.
<bullet> Where a smoke detector installed outside a bedroom is
separated from an adjacent living area by a door, a smoke detector must
also be installed on the living area side of the door.
b. If the unit is occupied by any hearing-impaired person, the
smoke detectors must have an alarm system designed for hearing-impaired
persons.
4. The unit must have a living room and kitchen area with a sink,
cooking appliance, refrigerator, food preparation area, and food
storage area;
5. The unit must have two working outlets or one working outlet and
a permanent light within all habitable rooms;
6. Outlets within six feet of a water source must be GFCI
protected;
7. For climate zones designated by the Secretary through notice,
the unit must have a permanently installed heating source. No units may
contain unvented space heaters that burn gas, oil, or kerosene. In
accordance with the NSPIRE Standards notice (88 FR 40832), or
subsequent versions, HUD will require permanent heating sources in all
locales except for Hawaii, Puerto Rico, Guam, U.S. Virgin Islands,
American Samoa, and the Commonwealth of Northern Mariana Islands; this
follows the International Energy Conservation Code (IECC). Those
localities where permanent heating sources will not be required are
Tropical (per IECA designation).
8. The unit must have a guardrail when there is an elevated walking
surface with a drop off of at least 30 inches or greater measured
vertically.
9. The unit must have a permanently mounted lighting fixture in the
kitchen and each bathroom.
VI. State and Local Codes and Minimum Standards
The HOME statute and the HOME and HTF regulations require that a
project must comply with all zoning ordinances and meet all state and
local codes, ordinances, and standards, which can vary by the type of
housing or activity undertaken. Applicable state and local codes
include local zoning and building codes as well as state and local
occupancy and property maintenance codes. Generally, there are two
functional categories of codes:
<bullet> Codes that regulate ``voluntary'' construction or
development activity (e.g., zoning ordinances or codes, building codes,
rehabilitation codes). Once a specific use and type of building has
been determined, the building code generally regulates the construction
by establishing minimum technical standards (e.g., footers must be 42''
below grade, wall studs should be 16'' on center, windows must be
strong enough to withstand certain wind speeds, etc.). At their core,
these are safety standards intended to ensure construction will result
in structures that do not present undue risks of structural collapse,
fire, or other hazards to their occupants. These codes apply to HOME-
or HTF-assisted development projects.
<bullet> Codes that compel an owner to take action (e.g., housing
or habitability codes, rental licensing codes/requirements, property
maintenance codes). Failure to comply with these codes can result in
condemnation, requirements to vacate the property, state or local
government orders to make repairs, or actions by the state or local
government to directly mitigate the violation and charge the owner.
These codes apply to units occupied by tenants receiving HOME TBRA and
the ongoing property condition of HOME- or HTF- assisted rental
properties during the period of affordability.
NSPIRE at 24 CFR 5.703(f) provides that the NSPIRE standards for
the condition of HUD Housing do not supersede state and local codes.
Therefore, the NSPIRE standards, as applicable in the HOME and HTF
regulations, do not replace or override state and local codes but may
impose additional requirements not addressed by state and local codes.
A. New Construction: The regulations at 24 CFR 92.251(a) and
93.301(a) require that new construction projects meet all applicable
state and local residential building codes, ordinances, and zoning
requirements. In the absence of applicable state or local building
codes for new construction, HOME- and HTF-assisted projects must meet
the International Code Council's (ICC) International Residential Code
or International Building Code, as applicable to the type of housing
being developed or acquired.
B. Rehabilitation: Pursuant to the regulations at 24 CFR 92.251(b)
and 93.301(b), the participating jurisdiction's or grantee's
rehabilitation standards must require the housing to meet all
applicable state and local building codes (including rehabilitation
codes, if adopted by the state or locality), ordinances, and
requirements upon completion. In the absence of state or local building
codes that apply to rehabilitation, the participating jurisdiction or
grantee must use the International Existing Building Code of the ICC.
In addition, the standards of the participating jurisdiction must be
such that upon completion, the HOME-assisted project and units will be
decent, safe, sanitary, and in good repair
[[Page 19149]]
as described in 24 CFR 5.703. The housing must also not contain the
specific deficiencies established by HUD based on the applicable
standards in 24 CFR 5.703 and published in the Federal Register for
HOME and HTF assisted projects and units.
C. Acquisition of Standard Housing for Homeownership (e.g.,
Downpayment Assistance): The regulations at 24 CFR 92.251(c) and
93.301(c) require the participating jurisdiction's or grantee's
property standards to provide that the housing meets all applicable
state and local housing quality standards and code requirements, at a
minimum. In addition, the housing must not contain the specific
deficiencies established by HUD based on the applicable standards in 24
CFR 5.703 and published in the Federal Register for HOME and HTF
assisted projects and units.
D. HOME TBRA: The participating jurisdiction's ongoing property
standards must require the units occupied by tenants receiving HOME
TBRA to meet all applicable state and local code requirements and
ordinances. In the absence of existing applicable state or local code
requirements and ordinances, at a minimum, the participating
jurisdiction's standards must provide that the property does not
contain the specific deficiencies established by HUD based on the
applicable standards in 24 CFR 5.703 and published in the Federal
Register for housing occupied by tenants receiving HOME TBRA.
E. Ongoing Condition of HOME-Assisted Rental Housing: The
participating jurisdiction's ongoing property standards must require
the HOME-assisted rental housing to meet all applicable state and local
code requirements and ordinances during the period of affordability. In
the absence of existing applicable state or local code requirements and
ordinances, at a minimum, the participating jurisdiction's ongoing
property standards must provide that the property does not contain the
specific deficiencies established by HUD based on the applicable
standards in 24 CFR 5.703 and published in the Federal Register for
rental housing (including manufactured housing).
F. Ongoing Condition of HTF-Assisted Rental Housing: The grantee's
ongoing property standards must require, at a minimum, that the HTF-
assisted rental housing does not contain the specific deficiencies
established by HUD based on the applicable standards in 24 CFR 5.703
and published in the Federal Register for rental housing (including
manufactured housing).
VII. Specific Deficiency Lists
The NSPIRE final rule at 24 CFR 5.705(a) requires that HUD
establish NSPIRE inspection standards through notice. The final rule
also established a new framework for inspection, which focuses on three
areas--common areas and building systems inside the building that are
not inside a unit (Inside), the site, exterior building components and
systems outside the building (Outside) and interior components within
the individual dwelling units where the resident lives (Unit) of HUD
housing and ensures that they are ``functionally adequate, operable,
and free of health and safety hazards.'' The requirements in 24 CFR
5.705 do not apply to HOME and HTF projects. Instead, 24 CFR 92.251 and
93.301 each require HUD to publish specific deficiency lists that will
apply to certain HOME and HTF housing projects.
This notice is a complementary document which establishes the
specific deficiencies that must be corrected before HOME or HTF project
completion or during the period of affordability as required by the
participating jurisdiction's or grantee's property standards. HUD's
goal for the HOME and HTF property standards requirements is to align
with NSPIRE to the extent feasible and practical given the unique
circumstances of each eligible activity and tenure type. Consequently,
the NSPIRE Standards notice (88 FR 40832), and subsequent versions,
established the universe of deficiencies that HUD may apply to HOME and
HTF. This Notice does not establish new deficiencies. However, HUD
acknowledges that the deficiencies in this notice that apply to HOME
and HTF may differ due to frequent updates of specific deficiencies in
the NSPIRE Standards notice (88 FR 40832). Consequently, HUD's intent
is to update this notice periodically to remain consistent with
subsequent versions of the NSPIRE Standards notice (88 FR 40832), to
the extent feasible. Any changes will be published through notice in
the Federal Register before they are applicable.
To determine the appropriateness of applying each NSPIRE deficiency
to each HOME or HTF eligible activity, HUD analyzed each NPSIRE
standard and considered several factors, including:
<bullet> The severity of the deficiency: low, moderate, severe, or
life threatening.
<bullet> Whether HOME or HTF funds could be used to fix the
deficiency, which applies in rehabilitation projects at the time of
rehabilitation but not acquisition of standard housing projects or HOME
TBRA units.
<bullet> Whether the deficiency is considered a low health and
safety risk and considered a pass for a Housing Choice Voucher (HCV)
program.
<bullet> The impact of the deficiency on the assisted occupant's
unit, particularly in the homeownership context.
<bullet> For HOME TBRA and homebuyer acquisition, whether the owner
was likely to correct the deficiency, because their failure to do so
would remove the unit from the available inventory for HOME-assisted
projects.
<bullet> And, for homebuyer acquisition, whether buyers should
retain some choice to repair certain minor deficiencies at a later date
by excluding such deficiencies from the HOME and HTF requirements (to
ensure an adequate availability of homebuyer options, given the
constrained housing market).
The specific deficiency lists are applicable based on the type of
activity undertaken, the tenure type of the project, and the structure
of the building. For example, to streamline the inspection process for
single unit structures, HUD will not require any of the ``Inside''
deficiencies from the checklists to be inspected because the entire
interior of the building constitutes the ``Unit'' and therefore the
``Inside'' inspectable area is not applicable. The lists are attached
as Appendices A-D as follows:
Appendix A: Specific Deficiencies for Rehabilitation of Rental and
Homebuyer Projects and Ongoing Rehabilitation
Appendix B: Specific Deficiencies for HOME Owner-occupied
Rehabilitation Projects
Appendix C: Specific Deficiencies HOME Tenant-Based Rental Assistance
Units
Appendix D: Specific Deficiencies for Acquisition of Standard Housing
for Homeownership
VIII. Life-Threatening Deficiencies
The HOME regulations at 24 CFR 92.251(b) and 92.251(f) and the HTF
regulations at 24 CFR 93.301(b) and 93.301(e) require a participating
jurisdiction's or grantee's rehabilitation and ongoing property
standards for both rental housing and HOME TBRA units to specify the
life-threatening deficiencies that must be addressed immediately if a
housing unit is occupied. In addition, NSPIRE at 24 CFR 5.703(e)
requires that the inside, outside, and unit must be free of health and
safety hazards that pose a danger to residents.
[[Page 19150]]
Consistent with the Housing Opportunity Through Modernization Act
of 2016 (Pub. L. 114-201) (HOTMA), HUD published a list of life-
threatening conditions (``HOTMA LT List'') through notice in ``Housing
Opportunity Through Modernization Act of 2016: Implementation of
Various Section 8 Voucher Provisions'' (82 FR 5458). In addition, HUD
included the HOTMA LT List in the NSPIRE Standards Notice (88 FR
40832), and subsequent versions, and is attached to this notice as
Appendix E. In the NSPIRE Standards, deficiencies which are considered
life-threatening for purposes of the Housing Choice Voucher (HCV) and
Project-Based Voucher (PBV) programs are noted with a 24-hour HCV
Correction Timeframe for occupied units.
While neither the HOTMA LT List nor the 24-hour HCV Correction
Timeframe formally applies to HOME or HTF, participating jurisdictions
and grantees are still required to specify life-threatening
deficiencies in their standards. Accordingly, HUD strongly encourages
participating jurisdictions and grantees to adopt the HOTMA LT List as
part of their rehabilitation, ongoing rental, and HOME TBRA property
standards to meet HOME and HTF health and safety requirements. In such
instances, participating jurisdictions and grantees may also specify
additional deficiencies as life-threatening.
IX. Major Systems and Capital Needs Assessments
A. Major Systems. As part of its rehabilitation standards, a
participating jurisdiction or grantee must develop useful life
standards for all major systems, which the regulation at 24 CFR
92.251(b) and 93.301(b) defines as structural support; roofing;
cladding and weatherproofing (e.g., windows, doors, siding, gutters);
plumbing; electrical, and heating, ventilation, and air conditioning.
<bullet> For rental housing, a participating jurisdiction's or
grantee's rehabilitation standards must require an estimate (based on
age and condition) of the remaining useful life of these major systems,
upon project completion. If the remaining useful life of one or more
major system is less than the applicable period of affordability, a
participating jurisdiction or grantee's standards must ensure that a
replacement reserve is established and that monthly payments to the
reserve are adequate to repair or replace the systems as needed. For
multifamily housing projects with 26 total units or more, a
participating jurisdiction or grantee's standards must require that
this determination be made through a capital needs assessment (CNA) for
the project.
<bullet> For homeownership housing, the rehabilitation standards
must require that upon project completion, major systems must have a
remaining useful life of at least five years, or a longer period
specified by a participating jurisdiction or grantee. If the estimate
of useful life of any major system is less than five years, it must be
rehabilitated or replaced as part of the scope of work for the
rehabilitation.
For rehabilitation projects that do not require a CNA, the
participating jurisdiction or grantee should require the project owner
to identify the remaining economic life of the major system components
after the proposed rehabilitation. Participating jurisdiction or
grantee staff may review this analysis internally based on the
rehabilitation scope, an onsite inspection of the major system
components, and a standard useful life table as the primary inputs.
Alternatively, a participating jurisdiction or grantee may hire a
professional to conduct the useful life analysis.
B. Capital Needs Assessments (CNA). For multifamily rental projects
with 26 or more total units, the participating jurisdiction's or
grantee's rehabilitation standards must require that the scope of work
for the HOME- or HTF-assisted rehabilitation and the long-term physical
needs of the project, including but not limited to major systems, are
determined through a CNA. A CNA is an inspection of the property to
provide an extensive analysis of building systems, recommendations for
specific improvements, and funding estimates for long-term replacement
costs. A participating jurisdiction or grantee should establish
standards for CNAs and qualifications for providers of CNAs.
<bullet> Technical Standards: The HOME and HTF regulations do not
specify a specific technical standard for CNAs used by participating
jurisdictions or grantees. Participating jurisdictions and grantees are
encouraged to consult existing standards, such as the ASTM E2018-15
Standard Guide for Property Condition Assessments or the HUD
Multifamily Accelerated Processing (MAP) Guide (4430.G), or the Fannie
Mae Instructions for Performing a Multifamily Property Condition
Assessment (Form 4099 Version 2), when developing local policies.
<bullet> Provider Qualifications: The CNA must be completed by a
qualified professional, such as an architect, engineer, or expert in
building systems, as defined by the participating jurisdiction or
grantee. A participating jurisdiction or grantee has the option to
directly procure a CNA provider for a project under consideration
(subject to applicable procurement requirements in 24 CFR part 92 and
Part 93 respectively); establish a pre-approved list or qualifications
and require an owner/applicant to obtain the CNA from an acceptable
provider; or accept reports initially prepared for another funder or
lender. In any case, a participating jurisdiction or grantee must
independently review the CNA and ensure the rehabilitation scope and
amount of replacement reserves complies with its HOME or HTF
rehabilitation and underwriting standards. In general, if the
previously performed CNA is more than a year old at the time of project
commitment, the participating jurisdiction or grantee should determine
if it is reflective of current conditions and the planned improvements
included in the scope of rehabilitation or if the CNA should be
updated.
<bullet> Costs of Providing a CNA: The cost of conducting a CNAs
for a HOME- or HTF-assisted rehabilitation project may be charged as an
administrative cost under 24 CFR 92.207(a) or 93.202 or as a project-
related soft-cost under 24 CFR 92.206(d) or 93.201(d) as applicable.
X. Lead-Based Paint
In accordance with 24 CFR 5.703(e), 92.355 and 93.351, all ``target
housing'' assisted with HOME or HTF is subject to the lead-based paint
requirements at 24 CFR part 35, subparts A, B, J, K, M and R, as
applicable. Target housing is any housing constructed prior to 1978,
except housing for the elderly or persons with disabilities or any 0-
bedroom dwelling (unless any child who is less than 6 years of age
resides or is expected to reside in such housing). A participating
jurisdiction or grantee's written property standards must require the
target housing to meet the lead-based paint requirements for the type
of assistance and the type of activity being undertaken. The NSPIRE
final rule did not alter any lead-based paint requirements for the HOME
or HTF programs. Additionally, EPA's regulations at 40 CFR 745 continue
to apply, especially for renovation, repair and painting projects in
target housing where lead-based paint may be disturbed (40 CFR part 745
Subpart E).
XI. Accessibility
The HOME regulations at 24 CFR 92.251 (a) and 92.251(b), and the
HTF regulations at 24 CFR 93.301(a) and 93.301(b) require compliance
with 24 CFR part 8, which implements Section
[[Page 19151]]
504 of the Rehabilitation Act of 1973 (29 U.S.C. 794), and Titles II
and III of the Americans with Disabilities Act (U.S.C.1213-12189)
implemented at 28 CFR parts 35 and 36, as applicable. Covered
multifamily dwellings, as defined at 24 CFR 100.201, must also meet the
design and construction requirements at 24 CFR 100.205, which
implements the Fair Housing Act (42 U.S.C. 3601-3619). A participating
jurisdiction's or grantee's written rehabilitation standards must
require that all housing meet these accessibility requirements at
project completion and during the HOME or HTF period of affordability.
A participating jurisdiction's or grantee's standards may also require
improvements that are not specifically required by regulation or
statute to permit use by a person with disabilities. The NSPIRE final
rule did not alter any accessibility requirements for the HOME and HTF
programs.
XII. Energy Efficiency
Section 481 of the Energy Independence and Security Act of 2007
(``EISA,'' Pub. L. 110-140) amended section 109 of the Cranston-
Gonzalez National Affordable Housing Act of 1990 (Cranston-Gonzalez)
(42 U.S.C. 12709), and establishes procedures for setting minimum
energy standards. EISA references two standards: the International
Energy Conservation Code (IECC) and ANSI/ASHRAE/IES Standard 90.1. The
IECC standard applies to single family homes and multifamily low-rise
buildings (up to three stories), while the ASHRAE 90.1 standard applies
to multifamily residential buildings with four or more stories.
Sections 109(c) and (d) of Cranston-Gonzalez, as amended by EISA,
establish procedures for updating HUD and USDA energy standards
following periodic revisions to the IECC and ASHRAE 90.1 codes, based
on:
1. A determination by HUD and United States Department of
Agriculture (USDA) that the revised codes would not negatively affect
the availability or affordability of housing covered by the Cranston-
Gozalez National Affordable Housing Act of 1990 (NAHA), and
2. The Secretary of Energy's determination under section 304 of the
Energy Conservation and Production Act (42 U.S.C. 6833) that the
revised codes would improve energy efficiency (42 U.S.C. 12709(d)).
On July 28, 2021, the Department of Energy (DOE) published final
determinations that the 2021 IECC and ASHRAE 90.1-2019 standards would
improve energy efficiency (86 FR 40529 and 86 FR 40543). On April 26,
2024, HUD and USDA issued a notice of final determination (Final
Determination notice) (89 FR 33112) that the 2021 IECC and ASHRAE 90.1-
2019 energy codes will not negatively impact the affordability or
availability of housing covered by EISA. The effective date of this
determination is May 28, 2024. Following the publication of the final
determination, HUD published on its website a list of alternative
compliance paths, which are high performance building standards that
HUD determined meet the 2021 IECC and ASHRAE 90.1-2019 standards.
While the 2013 HOME final rule reserved the energy efficiency
requirements at 24 CFR 92.251(a), the requirements in the HOME statute
apply to all HOME-assisted new construction projects. Specifically,
section 215(a)(1)(F) and section 215(b)(4) of NAHA (42 U.S.C.
12745(a)(1)(F) and (b)(4)) require that all newly constructed HOME-
assisted housing meet the energy efficiency standards promulgated in
accordance with Section 109 of Cranston-Gonzalez and, therefore,
Section 481 of EISA. The 2025 HOME final rule now includes an explicit
provision in 24 CFR 92.251(a)(3)(ii) that newly constructed housing
shall qualify as affordable housing under 24 CFR part 92 only if it
meets the energy efficiency standards promulgated by the Secretary in
accordance with section 109 of the HOME statute. In addition, the HTF
regulations at 24 CFR 93.301(a) impose the energy efficiency at Section
109 of NAHA on HTF-assisted new construction projects.
The Final Determination notice (89 FR 33112) established a
compliance date for HOME and HTF projects one year after the effective
date of the determination. Consequently, all HOME- and HTF-assisted new
construction projects with commitment dates on or after November 24,
2024, must meet the 2021 IECC or ASHRAE 90.1-2019 energy codes, as
applicable, or one of the alternative compliance pathways. However, HUD
and USDA adopted later compliance dates for other types of covered
housing, ranging from 12 to 24 months. If a HOME or HTF project with a
commitment on or after November 24, 2024, is also subject to the
updated energy efficiency requirements in the Final Determination
notice through another funding source that has a later compliance date,
then the participating jurisdiction or grantee is permitted to require
compliance with the energy efficiency standards in accordance with the
later compliance date for that funding source.
XIII. Disaster Mitigation
Where relevant, a participating jurisdiction's or grantee's
standards must require the housing to be constructed to mitigate the
impact of potential disasters (e.g. earthquakes, hurricanes, flooding,
wildfires, etc.) in accordance with state and local codes and
ordinances, or other such requirements that HUD may establish. HUD
encourages participating jurisdictions and grantees in earthquake prone
areas to adopt the earthquake-resistant design provisions of the 2015
editions, or successor editions, of the International Building Code
(IBC) or the International Residential Code (IRC) promulgated by the
International Code Council (ICC), or equivalent codes, consistent with
the provisions of and to the extent required by 40 U.S.C 3312.
XIV. Broadband
For new HOME or HTF commitments made after January 19, 2017, all
new construction or substantial rehabilitation multifamily rental
projects must include the installation of broadband infrastructure.
In accordance with 24 CFR 92.251(a) and 93.301(a), HOME and HTF-
assisted new construction multifamily rental projects are excluded from
this requirement if a participating jurisdiction or grantee determines
and documents its determination that:
<bullet> The location of the new construction project makes the
installation of broadband infrastructure infeasible; or
<bullet> The cost of installing the infrastructure would result in
a fundamental alteration in the nature of the participating
jurisdiction's program or activity or create an undue financial burden.
Furthermore, in accordance with 24 CFR 92.251(b) and 93.301(b),
HOME- and HTF-assisted multifamily rental substantial rehabilitation
projects are excluded from this requirement if a participating
jurisdiction or grantee determines and documents its determination
that:
<bullet> The location of the substantial rehabilitation makes
installation of broadband infrastructure infeasible;
<bullet> The cost of installing broadband infrastructure would
result in a fundamental alteration in the nature of the participating
jurisdiction's program or activity, or an undue financial burden; or,
<bullet> The structure of the housing to be substantially
rehabilitated makes installation of broadband infrastructure
infeasible.
[[Page 19152]]
XV. Carbon Monoxide and Smoke Detection
A. Carbon Monoxide. In accordance with 24 CFR 92.251(a), 92.251(b),
92.251(c) and 92.251(f), a carbon monoxide alarm must be installed in
the housing unit in a manner that meets or exceeds the carbon monoxide
detection standards set by HUD through Federal Register publication.
This requirement applies to projects with HOME commitments made on or
after April 20, 2026. This Notice does not provide the carbon monoxide
standards for HOME projects.
B. Smoke Detection. In accordance with 24 CFR 92.251(a), 92.251(b),
and 92.251(c), projects with HOME commitments made on or after April
20, 2026, must include
1. A hardwired smoke alarm must be installed:
a. On each level of each housing unit;
b. In or near each sleeping area in each housing unit;
c. In the basement of each housing unit and in each common area of
a project. A hardwired smoke alarm is not required in crawl spaces or
unfinished attics of housing units;
d. Within 21 feet of any door to a sleeping area measured along a
path of travel; and
e. Where a smoke alarm installed outside a sleeping area is
separated from an adjacent living area by a door, a smoke alarm must
also be installed on the living area side of the door.
2. Each hardwired smoke alarm must have an alarm system designed
for hearing-impaired persons.
3. The Secretary may establish additional standards through Federal
Register publication.
4. Following the relevant specifications of the International Code
Council (ICC) or the National Fire Protection Association Standard
(NFPA) 72 also satisfies the HOME requirement for smoke detection.
5. In accordance with 92.251(b), and 92.251(c), if the installation
of hardwired smoke detectors places an undue financial burden on the
owner or is infeasible, a participating jurisdiction may provide a
written exception to allow the owner of housing that is rehabilitated
or housing that is acquired in standard condition to install a smoke
detector that uses 10-year non-rechargeable, non-replaceable primary
batteries. The smoke detector must be sealed, tamper-resistant, contain
a means to silence the alarm, and otherwise comply with the HOME
property standard requirements.
The HOME regulations at 24 CFR 92.251(f) require that the
participating jurisdiction's ongoing property standards require housing
to contain smoke detectors in accordance with the requirements
contained in 24 CFR 5.703(b) and (d) instead of the above requirements.
XVI. Inspection Procedures
A participating jurisdiction or grantee must establish and follow
written inspection procedures for initial, progress, final, and ongoing
inspections in accordance with 24 CFR 92.251(g) and 93.301(e)(4). These
inspection requirements apply whether the participating jurisdiction's
HOME funds or grantee's HTF funds are used for construction costs--for
example, if HOME funds are disbursed only for acquisition and soft
costs or if HOME funds are only provided as permanent financing upon
completion of construction. The written policies and procedures must
include the following provisions:
A. Inspector Qualifications: The regulations at 24 CFR 92.251(g)
and 93.301(e)(4) require that the procedures describe the minimum
inspector qualifications and/or training for the required on-site
inspections. The regulations do not require that participating
jurisdiction or grantee staff conduct the inspections. A participating
jurisdiction or grantee may rely on inspections conducted by third
parties if the entity responsible for inspections is professionally
obligated to the participating jurisdiction. When using third party
inspectors, a participating jurisdiction or grantee may procure
inspectors to provide services across its portfolio or coordinate with
other debt providers and/or public funders to undertake shared
inspections. The participating jurisdiction or grantee is ultimately
responsible for ensuring that work is completed in accordance with its
HOME or HTF property standards. In addition, the inspection covers
applicable state and local codes, standards, and other federal
requirements and the participating jurisdiction or grantee must review
inspection results for compliance.
B. Cost of Inspections: The cost of conducting on-site inspections
may be charged as an administrative cost under 24 CFR 92.207(a) and
93.202(b) or as a project-related soft-cost for a project at 24 CFR
92.206(d) and 93.201(d) before project completion. Ongoing inspections
of rental housing may not be charged as a project-specific soft costs
because they occur after project completion. Alternatively, pursuant to
24 CFR 92.214(b) and 93.204(b), participating jurisdictions and
grantees may charge a reasonable annual monitoring fee to owners of
rental projects for compliance monitoring during the period of
affordability. The fees must be based upon the average actual cost of
performing the monitoring of the assisted rental projects. The basis
for determining the amount of the fee must be documented and the fee
must be included in the costs of the project as part of the project
underwriting.
A third party, including another project funder, may also pay for
the cost of the inspections, as long as the inspector is contractually
obligated to the participating jurisdiction or grantee to inspect to
HOME or HTF property standards. Inspections may not be paid for or
conducted by the owner or related parties, including an equity investor
or other member of a partnership entity.
C. Frequency of Inspections
1. Initial Inspections of Existing Housing
The regulations at 24 CFR 92.251(b) and (c), and 93.301(b) and (c)
require that the participating jurisdiction or grantee conduct an
initial property inspection to identify deficiencies that must be
addressed before completion of the rehabilitation or acquisition
project. If an initial property inspection of an acquisition of
standard housing by an entity other than a homebuyer identifies
deficiencies that require rehabilitation, then the project shall be
considered a rehabilitation project. A rehabilitation project must meet
the participating jurisdiction's or grantee's rehabilitation standards
as described in 24 CFR 92.251(b) or 24 CFR 93.301(b) and this Notice.
This includes being free of the deficiencies identified in Appendix A
of this Notice and the requirements for progress and final inspections
described below.
For acquisition of standard housing by a homebuyer, the inspection
must occur no earlier than 90 days before HOME or HTF funds are
committed in accordance with 24 CFR 92.251(c) and 24 CFR 93.301(c). If
an initial inspection acquisition standard housing for acquisition by a
homebuyer in HOME or HTF identifies deficiencies that require
rehabilitation and the homebuyer uses HOME or HTF funds to rehabilitate
the housing unit, the housing must meet the applicable participating
jurisdiction or grantee's rehabilitation standards in accordance with
24 CFR 92.251(b) or 24 CFR 92.301(b) and this Notice. This includes
being free of the deficiencies identified in Appendix A of this Notice
and the requirements for progress and final inspections described
below.
[[Page 19153]]
2. Progress and Final Inspections
The number and frequency of progress inspections for rehabilitation
projects in accordance with 24 CFR 92.251(b) and 93.301(b) will depend
on the size, scope, and complexity of the project. Progress inspections
are intended to ensure that work is done in accordance with applicable
codes and requirements, the construction contract, and related
construction documents (e.g., plans and specifications). They also
serve to verify construction work that will later be covered and no
longer visible at final inspection; to ensure work is completed prior
to approval of payment requests; and, to monitor whether the project
will meet project and program deadlines. Consequently, when
establishing a schedule for progress inspections, the participating
jurisdiction or grantee should consider standard disbursement
procedures, key construction milestones, and a minimum inspection
frequency. In addition, for HOME, a participating jurisdictions should
consider whether to adjust the inspection schedule based on results of
progress inspections or to ensure that the project will comply with the
HOME four-year project completion deadline at 24 CFR 92.205(e) .
In accordance with 92.251(b) and (c), 93.301(b) and 93.404(d),
before completing the project in the Integrated Disbursement and
Information system, the participating jurisdiction or grantee must
perform an on-site inspection of the project to determine that all
contracted work has been completed in accordance with the construction
documents and work writeups and that the project complies with the
property or rehabilitation standards and requirements. Under the 2025
HOME final rule, 24 CFR 92.251(b) permits a participating jurisdiction
to accept a determination made under another funding program that upon
completion of the rehabilitation project that the project and units are
decent, safe, sanitary and in good repair, based on an inspection
conducted in accordance with NSPIRE. If a participating jurisdiction
accepts the determination made under another funding program, they are
not required to inspect the project for compliance with the NSPIRE
requirements at 24 CFR 5.703, however a final on-site inspection may
still be necessary to determine compliance with state and local codes
and other components of the participating jurisdiction's rehabilitation
standards.
For HOME-assisted homebuyer acquisition projects, a final
inspection is required when the housing does not meet the participating
jurisdiction's property standards at acquisition. If HOME funds are
used in the rehabilitation, the property must meet the minimum
deficiency requirements for rehabilitation projects, including being
free of the minimum deficiencies described in Appendix A of this
Notice. If HOME funds are not used in the rehabilitation, then the
homebuyer acquisition project must meet the requirements for standard
acquisition of housing by a homebuyer and Appendix D of this Notice.
In the 2025 HOME final rule, 24 CFR 92.251(c) permits the
participating jurisdiction to require that the property meet its
standards within six months of acquisition if funding is secured to
complete the rehabilitation. The participating jurisdiction may provide
an extension of up to 12 months from the acquisition and must conduct a
final inspection.
3. Annual HOME TBRA Inspections
The participating jurisdiction must perform annual on-site
inspections of rental housing occupied by tenants receiving HOME-
assisted TBRA to determine compliance with the participating
jurisdiction's standards. Under the 2025 HOME final rule, 24 CFR
92.251(f) permits a participating jurisdiction to accept a
determination made under another funder's program that within the past
3 months the unit was determined to be decent, safe, sanitary and in
good repair, based on an inspection conducted in accordance with
NSPIRE.
4. Ongoing Inspections of Rental Housing
The participating jurisdiction or grantee must perform on-site
inspections of assisted rental housing projects within the first 12
months after project completion and at least once every three years
during the period of affordability in accordance with 24 CFR 32.251(f)
and 93.404(d). Under the 2025 HOME final rule, 24 CFR 92.251(f) permits
a participating jurisdiction to accept a determination made under
another funder's program that within the past 12 months the project and
units were determined to be decent, safe, sanitary and in good repair,
based on an inspection conducted in accordance with NSPIRE. However, a
participating jurisdiction may not accept a determination made under
another funder's program for the first ongoing inspection occurring 12
months after project completion.
If a participating jurisdiction or grantee finds during an ongoing
inspection that a property has life-threatening deficiencies, as
defined in its property standards, it must adopt a more frequent
inspection schedule for that property. The 2025 HOME final rule permits
an exception to this rule for small-scale HOME rental projects (one-to-
four-units). In the 2025 HOME final rule, 24 CFR 92.251(f) permits, but
does not require a participating jurisdiction to adopt, a more frequent
inspection schedule for small-scale housing projects where a life-
threatening deficiency is identified. A participating jurisdiction must
describe this exception in its inspection procedures.
The regulations at 24 CFR 92.504 (which has been moved to 24 CFR
92.251(f) under the 2025 HOME final rule) and 93.404(d) require rental
property owners to certify to the participating jurisdiction or grantee
annually that each building and all assisted units in the project are
suitable for occupancy. The certification must cover state and local
health, safety, and other applicable codes, ordinances, and
requirements, and the ongoing property standards established by the
participating jurisdiction to meet the requirements of 24 CFR 92.251
and 93.301. These self-certifications do not relieve a participating
jurisdiction or grantee of the requirement of its obligation to perform
an on-site inspection of all HOME- or HTF-assisted rental housing at
least every three years.
D. Ongoing Rental Inspection Sample: Prior to the 2025 HOME final
rule, both the HOME regulation at 24 CFR 92.504(d) and HTF regulation
at CFR 93.404(d) required the inspection to be performed on a
statistically valid sample of units appropriate for the size of the
assisted project. The 2025 HOME final rule has moved this requirement
to 24 CFR 92.251(f) and revised this requirement to require ongoing
rental inspections to be performed on a random sample of the HOME-
assisted units. HUD has determined that the below satisfies both the
HTF requirements and the HOME requirements.
<bullet> For projects with one to four HOME- or HTF-assisted units,
a participating jurisdiction or grantee must inspect 100 percent of the
HOME- or HTF-assisted units.
<bullet> For projects with more than four HOME- or HTF-assisted
units, a participating jurisdiction and grantee must randomly sample
and inspect the following number of HOME or HTF units, as applicable:
[[Page 19154]]
Minimum Inspection Sample Size for HOME Rental Housing Projects
------------------------------------------------------------------------
Number of
units that
must be
selected in
Number of HOME-assisted units in the HOME project the random
sample (i.e.,
minimum unit
sample size)
------------------------------------------------------------------------
1-20.................................................... 4
21-25................................................... 5
26-30................................................... 6
31-35................................................... 7
36-40................................................... 8
41-45................................................... 9
46-50................................................... 10
51-55................................................... 11
56-60................................................... 12
61-65................................................... 13
66-70................................................... 14
71-75................................................... 15
76-80................................................... 16
81-85................................................... 17
86-90................................................... 18
91-95................................................... 19
96-100.................................................. 20
101-105................................................. 21
106-110................................................. 22
111-115................................................. 23
116-120................................................. 24
121-125................................................. 25
126-130................................................. 26
131-166................................................. 27
167-214................................................. 28
215-295................................................. 29
296-455................................................. 30
456-920................................................. 31
921+.................................................... 32
------------------------------------------------------------------------
<bullet> For projects with more than one building, the inspection
must include all inspectable areas (Inside, Outside, and Unit) and at
least one HOME- or HTF-assisted unit in each residential building in
the HOME or HTF project.
E. Correction of Deficiencies: The participating jurisdiction or
grantee must have procedures for ensuring that timely corrective and
remedial actions are taken by the project owner to address identified
deficiencies. Life-threatening health and safety deficiencies must be
corrected immediately, in accordance with 24 CFR 92.251, 93.301 and
93.404. This applies to initial, progress, final, or ongoing
inspections, as applicable for all HOME or HTF activities if the unit
is occupied. However, if life-threatening deficiencies are determined
during an initial inspection for a rehabilitation project, then the
housing is not yet a HOME- or HTF-assisted project and the
participating jurisdiction or grantee must meet the HOME or HTF
commitment requirements before HOME or HTF can be used to pay for the
costs of correcting such deficiencies.
For non-life-threatening deficiencies identified during the period
of affordability, the regulations at 24 CFR 92.504(d) (or 24 CFR
92.251(f) under the 2025 HOME final rule) and 93.404(d) require that a
follow-up on-site inspection must be performed within 12 months to
verify that deficiencies were corrected. However, a participating
jurisdiction or grantee may establish a list of non-hazardous
deficiencies for which correction can be verified by third-party
documentation (e.g. a paid invoice for a work order) rather than
through re-inspection.
XVII. Recordkeeping
A. Written agreements: The participating jurisdiction,
subrecipient, state recipient, grantee, or HTF subgrantee must impose
ongoing property standards on an assisted project in its written
agreement with the owner of the housing in accordance with 24 CR 92.504
and 93.404. For rental housing and units assisted with HOME TBRA, the
written agreement must require the owner to maintain each building and
assisted unit in compliance with the participating jurisdiction's or
grantee's property standards, and should:
<bullet> Obligate the owner to comply with the onsite inspection
schedule: annual for units occupied by tenants receiving HOME TBRA and
at least every three years during the period of affordability for HOME-
or HTF-assisted rental housing. The agreement should also allow for
changes in frequency of inspections based on findings of health and
safety defects;
<bullet> Require the owner to correct deficiencies identified
during onsite inspections, including a requirement to immediately
correct health and safety defects; and,
<bullet> For rental housing, require the owner to annually certify
each building and all assisted units in the project are suitable for
occupancy.
B. Construction documents and cost reasonableness: A participating
jurisdiction's or grantee's property standards must describe
requirements for the submission of construction or rehabilitation
contracts and documents that detail the scope of work for the project
in accordance with 24 CFR 92.251(b) and 93.301(b). The description of
the work must be in adequate detail to establish the basis and schedule
for a uniform inspection of the housing to determine compliance with a
participating jurisdiction's or grantee's property standards. The
participating jurisdiction or grantee must also review and approve
written cost estimates for construction and determine that costs are
reasonable and document its approval.
The Uniform Administrative Requirements at 2 CFR 200.404 state that
a cost is reasonable if, in its nature and amount, it does not exceed
what would be incurred by a prudent person under the circumstances
prevailing at the time the decision was made to incur the cost. In its
determination of cost reasonableness, a participating jurisdiction or
grantee should consider market prices for comparable goods or services
for the geographic area and document its decision.
C. Initial, Progress, Final, and Ongoing Inspections: In accordance
with 24 CFR 92.508(a) and 93.407(a), the participating jurisdiction or
grantee must maintain records (e.g., inspection reports) demonstrating
that each project meets the property standards of 24 CFR 92.251 or
93.301 at project completion. In addition, during the period of
affordability, records for rental projects that demonstrate compliance
with the HOME or HTF property standards and actions pursuant to 24 CFR
92.251(f) or 93.404(d). The specific records applicable to each
eligible activity are as follows:
1. New Construction
In its project file, a participating jurisdiction or grantee must
maintain the approved written cost estimates, construction documents,
and contracts and the signed and dated checklists or reports for all
progress and final inspections in accordance with 24 CFR 92.251(a) and
93.301(a). Absent detailed inspection records, a general certification
that the property meets applicable building codes is not sufficient to
satisfy the inspection requirement. In addition, approved building
plans must be maintained, and the certificate of occupancy and any
architect's certifications, if available, should be maintained in the
project file.
To demonstrate compliance with the minimum energy standards
required under Section 109 of the HOME statute (and at 24 CFR
92.251(a)(3)(ii) of the 2025 HOME final rule) and 93.301(a)(2)(ii),
participating jurisdictions or grantees must maintain at least one of
the following: a third-party certification conducted by a home energy
rater, a certification from the architect or engineer for the project,
or an inspection conducted by the participating jurisdiction or its
inspector including the local building inspector or code official.
2. Rehabilitation
At a minimum, the regulations at 24 CFR 92.251(b) and 93.301(b)
require that the project file must contain approved written cost
estimates, construction
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documents, contracts and signed and dated checklists or reports for the
initial, progress, and final inspections. Under the 2025 HOME final
rule, the HOME regulations at 24 CFR 92.251(b)(1)(viii) permit a
participating jurisdiction to maintain records of a determination made
at the time of completion of the rehabilitation that the project is
decent, safe, sanitary and in good repair in satisfaction of another
funder's required inspection under NSPIRE.
As applicable, the file should also include the architect's
certification and the certificate of occupancy or other similar
documentations of local code approvals.
3. Acquisition of Newly Constructed Standard Rental Housing
A participating jurisdiction or grantee must maintain records of
the approved building plans, the certificate of occupancy, and a signed
and dated inspection checklist or report demonstrating that the
inspection was conducted no earlier than 90 days before the commitment
of HOME or HTF funds in accordance with 24 CFR 92.251(c) or 93.301(c),
respectively.
4. Acquisition of Standard Housing for Homeownership
The participating jurisdiction or grantee's project file must
contain a signed and dated checklist or report of the final property
inspection to demonstrate compliance with property standards. The
records must demonstrate that inspection of the property was performed
no earlier than 90 days before the commitment of HOME or HTF assistance
in accordance with 24 CFR 92.251(c) and 93.301(c), respectively. For
the HOME-assisted projects operating under the new flexibilities in the
2025 HOME final rule, if the housing is not rehabilitated to meet the
standards of 24 CFR 92.251(c) before acquisition, the project file must
include the following in accordance with 24 CFR 92.251(c)(3)(ii):
a. The written agreement between the participating jurisdiction and
the homebuyer which requires the property to meet the standards within
6 months of acquisition with HOME assistance;
b. Evidence that funding was secured to complete the rehabilitation
necessary to comply with the standards; and
c. Documentation that the final inspection was conducted within six
months after acquisition and that the property met the standards.
d. If applicable, documentation of any extension (of up to 12
months from acquisition) provided by the participating jurisdiction to
the homebuyer to meet the standards and an amended written agreement
that reflects the extension and requires a final inspection to be
conducted within 12 months of acquisition.
5. TBRA
In accordance with 24 CFR 92.251(f), a participating jurisdiction
must maintain signed and dated inspection checklists or reports of the
initial and ongoing inspections. Under the 2025 HOME final rule, the
HOME regulations at 24 CFR 92.251(f)(4)(ii) permit a participating
jurisdiction to maintain records of a determination made within the
prior 3 months that the unit is decent, safe, sanitary and in good
repair, in satisfaction of another funder's required inspection under
NSPIRE.
6. Ongoing Property Condition of Rental Housing
In accordance with 24 CFR 92.251(f), 93.301(e), and 93.404(d), the
participating jurisdiction's or grantee's rental housing project file
must contain signed and dated inspection checklists or reports of
ongoing inspections. The records must demonstrate that an inspection
occurred at project completion, 12 months after project completion, and
at least every three years during the project's period of
affordability. Such records must demonstrate that any deficiencies were
corrected pursuant to the regulations, and the property met the
participating jurisdiction's or grantee's property standard
requirements. Under the 2025 HOME final rule, the HOME regulations at
24 CFR 92.251(f)(3)(i)(B) permit a participating jurisdiction to
maintain records of a determination made within the prior 12 months
that the project and units are decent, safe, sanitary and in good
repair, in satisfaction of another funder's required inspection under
NSPIRE. However, the participating jurisdiction may not accept a
determination made by another funder for the initial ongoing inspection
conducted 12 months after project completion.
In addition, a participating jurisdiction or grantee must retain
records of the owner's annual certification that each building in the
project and all HOME- or HTF-assisted units in the project are suitable
for occupancy. For target housing, the participating jurisdiction or
grantee must retain records of its conducting visual assessment for
deteriorated paint surfaces (24 CFR 35.1215(a)(1)) and the failure of
any hazard reduction measures at unit turnover and every twelve months
(24 CFR 35.175, 35.1220 and 35.1355(a)(2)).
D. Correction of deficiencies: When there are observed
deficiencies, the regulations at 24 CFR 92.251(f)(5) and 93.301(e)(3),
project file must contain records demonstrating that a follow-up onsite
inspection occurred within 12 months, or a reasonable timeframe, to
verify that all observed deficiencies were corrected. If the
participating jurisdiction or grantee established a list of non-
hazardous deficiencies for which correction can be verified by third
party documentation rather than reinspection, the file must contain the
third-party documentation. Furthermore, the file must include evidence
that the participating jurisdiction or grantee adopted a more frequent
inspection schedule for properties that were found to have health and
safety violations.
Ronald Kurtz
Assistant Secretary for Community Planning and Development
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[FR Doc. 2026-07176 Filed 4-13-26; 8:45 am]
BILLING CODE 4210-67-P
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</html>Indexed from Federal Register on April 14, 2026.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.