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Marketing Our Section 8 Property Using Concessions

It’s not allowed! We recently did a file audit on a HUD Section 8 property and discovered that they were giving concessions to section 8 residents for resident referrals. That might be a great idea for the Conventional applicants but it does not apply to HUD Section 8. I vaguely remembered that it was not allowed for Section 8 residents so while I happened to be having dinner with a friend who had worked for a Contract Administrator (CA) and now works for HUD, I asked him about it. Without mentioning the property I was working at, I gave him the scenario: The property had Conventional and HUD Section 8 and was using the same marketing techniques at both types of housing. My friend told me “You can’t give concessions in the same manner you do with Conventional. If the property did do that they would have to give back any subsidy and give the tenant back any rent they paid for those months”. I had another client who was also told during a recent Management Occupancy Review (MOR), they too had to pay back the subsidy and the rent for the months a concession was given.

Where is this written? It is referenced in the Transmittal section of the old HUD Handbook 4350.3 Change 3 and in Paragraph 9-12.B.5 – Added note if an owner elects to grant rent concessions they cannot bill HUD for either the rental assistance or the tenant’s portion of the rent for the month or months the concession is given.

It is also referenced more recently in the TRACS 202D Mat User Guide. You can find the language under the “NOTE” in Section 7-12, paragraph B5, and it mimics what was said in the handbook.

Coming up with better marketing strategies; You can certainly give concessions in other areas such as services you provide as long as they are not tied to the tenants rent. How about a year gym membership?

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