The HOME Rental Development Program, funded through the Federal HOME Investment Partnerships program, assists communities and developers with increasing the supply of affordable rental housing. At least 15% of the State's annual HOME Investment Partnership Program funding is set-aside for Community Housing Development Organizations (CHDOs). Nonprofit organizations must meet certain criteria to be considered a CHDO, as defined by HOME program regulations. CHDOs must be independent of control by governmental or for-profit entities, and must have a formal process for including the input of low income individuals and neighborhoods into their activities.
The program helps communities, via housing developers, respond to housing issues and needs in underserved areas. Funds are awarded on a competitive basis annually. CHDOs may apply for deferred HOME loans to acquire, rehabilitate or construct rental housing. Most HOME-assisted projects involve significant leveraging of other resources, such as Low Income Housing Tax Credits (LIHTC), USDA Rural Development loans, FHLBank’s AHP funds, private debt, foundation grants, and resources from other Federal, State and local programs. The HOME Rental Development Program is effective in addressing some of the most difficult rental housing development need that communities have.
HOME funds often allow the owner/developer to reduce the amount of debt necessary to finance a development. Lower debt service requirements help a project remain viable and affordable with reduced rents over the long term. HOME-assisted units must be made available to low-income and very-low-income households at affordable rents, for a period of up to 20 years.
HOME-assisted units are restricted to occupancy by Low Income households (initially at or below 60 percent of the area median income) with rents at or below the High HOME rent limit. In developments with five or more HOME-assisted units, 20 percent of those units must be rented to Very Low Income households (at or below 50 percent of the area median income), with rents at or below the Low HOME rent limit.
Information about HUD’s Home Investment Partnerships (HOME) Program, including rent and income limits for each state and county, can be found at: https://www.hudexchange.info/programs/home/