Rental Property Investor · Doylestown, PA · Member since 2018 · 3 posts · 0 votes
I am interested in purchasing a 12 unit building and in the description it says it is a HUD building. I am wondering if there are any special requirements or difficulties I need to know about or should look out for?
Rental Property Investor · Toronto, Ontario · Member since 2012 · 538 posts · 298 votes
8y
YES - If this is truly a project HUD building where HUD 'guarantees' rent for all units then there are very specific / screening / reporting / inspections requirements that you must meet; tenant income thresholds, REAC inspections, etc.
You can do this yourself (HUD has to approve you to self manage) but most owners elect to hire a PM who is licensed / knows the systems / paper work / HUD office contacts. This is a sub specially of property management and many firms will not take it on.
This will likely increase your operating costs to some degree over a non-project HUD building. The flip side is the more secure income.