The Federal Housing Administration’s (FHA) Office of Multifamily Housing Programs has published a Mortgagee Letter (ML) “Build-To-Rent” Developments Underwriting Eligibility. The ML outlines new eligibility guidance for Build-To-Rent (BTR) developments. This policy is designed to make it easier for BTR projects consisting of detached single-family homes, duplexes, or triplexes, including site-built and manufactured homes, to qualify for FHA-insured financing. This update makes it easier to finance new rental homes and helps increase the supply of rental housing, particularly in light of manufactured housing innovation.
HUD is updating its underwriting and eligibility requirements so that BTR properties can qualify under two key multifamily programs:
- Section 221(d)(4) – New construction only.
- Section 223(f) – Acquisition or refinancing of recently developed (i.e., certificate of occupancy dated less than 3 years prior to application) multifamily rental housing only.