Novogradac Rent and Income Limit Estimator © Subscription
Understanding low-income housing tax credit (LIHTC) income and rent limit growth is vital. Better understanding how income limits will change in future years can enable developers, investors and lenders to better underwrite LIHTC properties.
Novogradac Rent and Income Limit Estimator © reports give insight into how income and rent limits in that area will change. Novogradac uses recent American Community Survey data (ACS) and the same calculation methodology as the U.S. Department of Housing and Urban Development (HUD) to estimate what income and rents will be in future years. Such reports can assist you in estimating income and rent growth rates and should be a part of every underwriting model for LIHTC properties.
A Note about Ordering
This is a purchase of an estimate with automatic updates. The estimate you receive will be calculated using the best available data as of the date of purchase. If and when available data changes, you will receive an updated estimate to that same address. Novogradac revises estimates, on average, four times from when ACS data is released to when HUD releases their limits; however, we cannot guarantee how many times available data will change. With the subscription we will send estimate updates automatically as many or as few times as the available data changes. If you would like to purchase a point-in-time estimate without automatic updates, see the Novogradac Rent and Income Limit Estimator ©.
If you are interested in purchasing rent and income limit estimates from us, please:
- review the list of available areas to see if estimates are available for your area.
- email your request(s) to [email protected] and you will receive a response with instructions indicating how many items to add to your cart.
The fee for limits with automatic updates is $1,000 per year per area requested. Once payment has been confirmed, you will receive an email with your purchases within one business day and then updates as they are available.
Purchases of 2023 estimates will be updated until HUD releases actual limits (expected April 2023).
Purchases of 2024 estimates will be updated until HUD releases actual limits (expected April 2024).
Datasets including all available VLI and HERA/Hold Harmless limits (defined below) are available for point-in-time estimates and with updates. For inquiries about datasets or for bulk purchase in excess of 10 areas please contact [email protected] for information.
Area median income (AMI) is calculated with same formula HUD uses when calculating AMI. This can be used to estimate income and rent limits that are based on AMI.
Very low income (VLI) is calculated with same formula and adjustments HUD uses when determining VLI. This can be used to estimate LIHTC and tax-exempt bond income and rent limits.
HERA Special (HERA)/Hold Harmless is calculated with the same formula and adjustments HUD uses when determining HERA and hold harmless estimates. Novogradac uses the higher of current year estimate or limits in any previous year since 2008. These limits can be used to estimate LIHTC income and rent limits for properties placed in service before 2009. For areas that qualify for HERA, HERA limits will be provided. If the area does not qualify for HERA, this option will provide VLI limits with hold harmless adjustments.
AMI should not be used for LIHTC rents. Please see this Notes from Novogradac blog post for more information about the difference between AMI and VLI and the adjustments that HUD applies to AMI to arrive at VLI: What you Need to Know About Income Limits.
The one-year American Community Survey (ACS) data normally used by HUD to calculate rent and income limits was not published for 2020, which is the dataset applicable to 2023 limits. ACS did, however, publish five-year data. While it is currently not known how HUD will calculate 2023 limits, we are able to apply HUD’s calculation to the five-year data to provide a baseline of what to expect. If HUD uses the five-year ACS and their traditional calculation to calculate limits, these estimates will be as accurate as they have been historically.
Accuracy continues to depend on changes in forecasted Consumer Price Index between estimate release and limit publication. If HUD chooses an alternative calculation, current indications are that an alternative calculation would result in limits higher than those resulting from the five-year ACS. If HUD chooses an alternative calculation, we will notify users by email. If we are able to calculate the alternative method, we will provide estimate updates reflecting that change for each subscription purchase.
HUD Fair Market Areas (HMFAs)
For certain areas, HUD publishes limits using proprietarily determined geographies called HMFAs. While HUD does use ACS data for these calculations, the ACS data HUD uses is not publicly available. However, for many areas there are ways to approximate the median income ACS data using population weighting or by using data points from closely related geographies like metropolitan statistical areas (MSAs). Many estimates for HMFAs are available but the accuracy of the estimates is lower than estimates for counties, single county HMFAs, and MSAs for which data is directly published. Areas where the alternative calculation is performed are marked clearly on the available estimate list.
Novogradac is not able to provide accurate estimates for all areas. Please refer to the list of available estimates for each report type. We will update this list as new areas become available. If you are interested in an area that is not on the list, please contact [email protected] to discuss in more detail what information Novogradac can provide for that area.