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U.S. Department of Housing & Urban Development (HUD) wants to finance more qualified opportunity zone (QOZ) projects.

Real estate investors in QOZ’s already stand to benefit from the capital gains tax deferrals permitted under the Tax Cuts and Job Act of 2017.   With its latest Notice, HUD further sweetens the deal.

For FHA insured loan applications for projects located in QOZ’s, FHA application fees are reduced.   More importantly, HUD will assign its best and brightest to process such applications, all to improve the execution and expedite loan processing.

HUD’s Section 221(d)4 loan is already one of best new construction/sub-rehab loans available in the market with up to 90% loan-to-cost financing.  However, one of the major drawbacks with HUD insured financing has been its longer processing times.  Given the signal from HUD, we expect HUD to prioritize QOZ project loan applications and significantly improve on its processing timelines.

Give us a call for more information on these benefits or how HUD financing can benefit your real estate investment.

U.S. Department of Housing & Urban Development (HUD) has issued a Section 202 Notice of Funding Availability (NOFA) for the first time since 2010. 

 Section 202 provides funding for the development and operation of supportive rental housing for income-qualified persons 62 years of age or older.  Under the program, eligible non-profit Sponsors can receive Capital Advance funds for the acquisition, construction, or rehabilitation of qualified senior housing projects along with a Project Rental Assistance Contract (“PRAC”) which provides rental subsidies for very-low income persons. 

 HUD is targeting projects that are at the forefront of design and service delivery and that will serve as a model for supportive housing providers within the industry. Accordingly, applicants need to demonstrate best practices and innovation in both physical design and supportive services. Proposals should promote the long-term physical and mental health and wellness of income-qualified elderly persons and the efficient use of government assistance. 

HUD has budget authority to award up to a total of $110 million.  Up to $50 million is available in this NOFA.  The remaining funds will be available in a second NOFA which HUD expects to publish in 2020.  The application due date is August 28, 2019.  Applicants are instructed to download the Application Package from Grants.gov and submit the application electronically. 

For more information, please feel free to give us a call.