Renter to Owner Ratio Calculation

Chan-yuW (Illinois)
Posts: 1

Posted:

Can anyone provide guidance on how the renter to owner ratio is calculated for FHA qualification purposes? For instance, are foreclosures, units owned by tax exempt organizations, or vacant units considered in the ratio? I know that the FHA lowered the renter to owner ratio to be FHA qualified from 51% to 50% and my condo association is very close to that number. Any guidance would be appreciated. Thanks!

MelissaP1 (Alabama)
Posts: 13,836

Posted:

I have filled out the form a few times as President. It's a simple 1 page form front and back. It's about 25 questions. Only about 2 - 3 of them are any kind of reference to rental/homeowner ratio. It asks how many units are owner occupied and how many are rented. How many are behind in dues or in process of collections? That's about it.

We had 107 homeowner's and I had to guesstimate on the number of rentals in our HOA. I usually estimated about 10 rentals. Which is about average. It's NOT the overblown "urban legend" numbers. Even if it were 20 rentals that still not that much out of 107. No one would have an exact number of rentals as the property changed hands within hours of For Sale signs being put up. (Had a property sell within 6 hours). Since OWNERs are required to pay the dues, that shouldn't/wouldn't show the HOA if they were using their property as rental. I guesstimated based on my social interaction amongst the residents.

It's most likely the President or Management company filling out the form. You may want to ask them what equation they use to figure out how many TRUE rentals there really are. They may be guessing too.

Former HOA President

MelissaP1 (Alabama)
Posts: 13,836

Posted:

I have filled out the form a few times as President. It's a simple 1 page form front and back. It's about 25 questions. Only about 2 - 3 of them are any kind of reference to rental/homeowner ratio. It asks how many units are owner occupied and how many are rented. How many are behind in dues or in process of collections? That's about it.

We had 107 homeowner's and I had to guesstimate on the number of rentals in our HOA. I usually estimated about 10 rentals. Which is about average. It's NOT the overblown "urban legend" numbers. Even if it were 20 rentals that still not that much out of 107. No one would have an exact number of rentals as the property changed hands within hours of For Sale signs being put up. (Had a property sell within 6 hours). Since OWNERs are required to pay the dues, that shouldn't/wouldn't show the HOA if they were using their property as rental. I guesstimated based on my social interaction amongst the residents.

It's most likely the President or Management company filling out the form. You may want to ask them what equation they use to figure out how many TRUE rentals there really are. They may be guessing too.

Former HOA President