24 C.F.R. § 880.609
§ 880.609 Adjustment of contract rents. (24 CFR Part 880)
Operative Text
(a) Automatic annual adjustment of Contract Rents. Upon request from the owner to the contract administrator, contract rents will be adjusted on the anniversary date of the contract in accordance with 24 CFR part 888. (b) Special additional adjustments. For all projects, special additional adjustments will be granted, to the extent determined necessary by HUD (for 24 CFR part 883 projects, by the Agency and HUD), to reflect increases in the actual and necessary expenses of owning and maintaining the assisted units which have resulted from substantial general increases in real property taxes, assessments, utility rates, and utilities not covered by regulated rates, and which are not adequately compensated for by annual adjustments under paragraph (a) of this section. The owner must submit to the contract administrator required supporting data, financial statements and certifications. (c) Overall limitation. Any adjustments of contract rents for a unit after Contract execution or cost certification, where applicable, must not result in material differences between the rents charged for assisted units and comparable unassisted units except to the extent that the differences existed with respect to the contract rents set at Contract execution or cost certification, where applicable.
Section 880.609 establishes three mechanisms governing how contract rents under HUD-assisted housing agreements may change over time. First, rents are automatically eligible for annual adjustment on the contract's anniversary date, following the methodology set out in 24 CFR part 888. Second, owners may seek additional, case-by-case adjustments when significant cost increases—such as rising property taxes, assessments, or utility rates—are not adequately addressed by the standard annual adjustment. Third, any rent adjustment is subject to an overall cap: adjusted rents for assisted units must not become materially different from rents charged for comparable unassisted units, unless that gap already existed when the contract was first executed or cost-certified.
Plain English — not legal advice.
Under § 880.609, compliant operators generally initiate the annual automatic adjustment by submitting a timely request to the contract administrator on or before the contract anniversary date, consistent with 24 CFR part 888 procedures. When extraordinary cost increases in property taxes, assessments, or utility rates outpace the standard annual adjustment, operators typically document those increases thoroughly—gathering financial statements, supporting data, and required certifications—before submitting a special additional adjustment request to the contract administrator for HUD review. Throughout both processes, operators keep an eye on the overall limitation in § 880.609(c), ensuring that any cumulative rent adjustments do not create a material disparity between assisted and comparable unassisted unit rents beyond what existed at contract execution or cost certification.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
Section 880.609 governs the rules that limit how much and under what circumstances a landlord participating in a HUD-assisted housing program can raise contract rents, providing tenants with a structural protection against rent increases that diverge materially from market rents for comparable unassisted units. Tenants who believe a rent adjustment has been applied in a manner inconsistent with § 880.609—for example, that it creates a material disparity not present at contract execution—may raise that concern as a potential issue when responding to any related housing action, or may contact HUD directly to inquire about compliance. Tenant-rights organizations and HUD's local field offices can be useful starting points for understanding how these adjustment rules apply to a particular assisted housing program.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated September 4, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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