The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited HUD’s process for reviewing and approving commercial rents for multifamily properties. Our objective was to determine whether HUD’s review and approval process for commercial rents ensured that multifamily properties received commercial rents that were comparable to market rate rents.

HUD did not have a uniform process to ensure that commercial rent rates were comparable to market rate rents. The New York City hub was the only field office reviewed that had a written procedure for the review and approval of commercial rents.

We recommend that the Deputy Assistant Secretary of Multifamily Housing Programs, develop and implement a uniform, written process to ensure that regional and field office staff fully understand and uniformly comply with requirements to ensure that owners set commercial rents at appropriate levels.