HUD Issues OCAFs for 2023: National Rate Hits 6.1%, Nearly Double 2022 Rate
The U.S. Department of Housing and Urban Development (HUD) will publish a notice in Tuesday’s Federal Register establishing operating cost adjustment factors (OCAFs) for eligible multifamily housing properties that have an anniversary date on or after Feb. 11, 2023. The national rate is 6.1% and OCAFs range from 4.8% in South Dakota to 8.3% in Maine. The 2022 rate was 3.1%. Due to historically high inflation levels, HUD calculated the cost component for most of the cost components using period of longer than a year. HUD will revert to year-over-year data going forward. OCAFs are used to adjust Section 8 rents renewed under Section 515 or 524 of the Multifamily Assisted Housing Reform and Affordability Act of 1997. Comments on the notice are due by Dec. 15.
Learn more about how inflation is affecting the affordable housing market and what investors and developers are doing to address it at the Novogradac 2022 Tax Credit Housing Finance Conference, Dec. 1-2 in Las Vegas.