In Kuntz's interview with Howard & Donovan he talks about the Joveljic trade as resulting from a $500K cap hit as he aged out of U22. On the one hand, it feels like a silly arbitrary cut off...on the other, it wasn't a surprise he turned 26. This could have been planned for. They just went all in.

Direct link to the report here: publicenterprise.org/report/commi...

In short, this change should give a small financial boost for some RAD-converting properties

That's why this notice is so important - it tweaks the upper limit for RAD/Section 18 blends, allowing up to 90% of units to go out under Section 18, up from 80% and widens eligibility. I wrote a little bit about this change for @publicenterprise.bsky.social: publicenterprise.org/huds-new-sec...

The average amount of rehab in RAD deals continues to go up, along with the percentage of deals pursuing blends. It's one of the few ways to leverage more funding to undertake deeper rehab.

It may seem strange that a notice focused on “demolition and disposition” of public housing is be crucial to its preservation, but RAD/Section 18 blends are one of the main tools used to improve converting projects finances, allowing them to access higher funding (110% FMR) for S18 units.

The limiting factor here is internal capacity and good data from property financial statements, but it's interesting to imagine what HUD could do with better, more up to date data on its assisted properties: greater transparency, resiliency planning, risk assessments for proactive management, etc.

Also great to see HUD updates its methodology slightly and switch to using actual property data instead of indices for rising insurance costs. The indices were national and missed regional variation. It also begs the question of whether HUD might be able to use real cost data more frequently...

Here’s a quick graphic showing the difference between FY25 and FY25 OCAFs broken out by state. Note - a decrease between years just means you’re seeing a smaller increase in subsidy relative to years prior. An OCAF adjustment will never be negative.

www.datawrapper.de/_/RO5pf/

HUD aggregates a bunch of cost indices and weights them based on the typical percentage of costs in their portfolio of properties. This administrative effort has significant real world impact. For projects that converted under RAD, it’s basically the only increase in funding you’ll see YoY…

Earlier this year, they became the first city in New York to implement the 421-p tax program to incentivize housing development for families earning 60%-80% of the Area Median Income.