CY2025 HUD Updates

Have you looked at the CY2025 HUD Updates? The Department of Housing and Urban Development (HUD) has released inflation-adjusted values for 2025. This document includes updated thresholds for assets and income and a revised passbook savings rate. Effective January 1, 2025, the changes align with Sections 102 and 104 of the Housing Opportunity Through Modernization Act (HOTMA). We recommend you wait until your software is fully updated before using these numbers!

Understanding these updates is important for compliance and planning for property managers, program administrators, and tenants. This week’s Tuesday Tip discusses all of this.

Takeaways: CY2025 HUD Updates

The updates include significant changes that impact how eligibility and rent calculations are performed across HUD programs. You can download the full document below.

1. Asset Limitations:

• The new cap for net family assets is $103,200, up from $100,000 in 2024.
• Self-certification thresholds have also increased to $51,600.

2. Income Thresholds:

• Imputed returns on net family assets are now required when the value exceeds $51,600.
• Non-essential personal property valued above $51,600 is included in net assets.

3. Mandatory Deductions:

• Elderly and disabled households receive an increased deduction of $525, up from $400.
• Dependent deductions remain unchanged at $480.

4. Passbook Savings Rate:

• The passbook rate, used to calculate imputed asset income, has been revised to 0.45%.

Why These Changes Matter

HUD’s adjustments aim to reflect inflation and ensure fair income and eligibility calculations for subsidized housing. For program administrators, the CY2025 HUD updates emphasize the importance of aligning operational processes with the latest regulations.

According to Vickie Bell, Navigate’s subject-matter expert, these adjustments help maintain compliance with HOTMA provisions and prepare the industry for the July 2025 full implementation of HOTMA software.

Compliance Challenges and Recommendations

Administrators must prepare for these changes while addressing potential implementation challenges:

HOTMA Compliance: If your property or program is not compliant with Sections 102 and 104, these tables may not apply immediately. HUD recommends waiting for updated software before implementing these changes.

Software Updates: HUD ensures systems like TRACS are prepared to handle the new data requirements. Until then, agencies should use the updated values for test calculations and await final software approval.

Resident Communication: Changes to asset limitations and deductions can affect residents’ rent calculations. To prevent misunderstandings, educating tenants about these updates through tools like newsletters and community meetings is crucial.

Practical Applications for Administrators

1. Updating Tenant Selection Plans:

• Ensure that self-certification thresholds and asset limits are included in your property’s tenant selection plan, and note that these values will adjust annually.

2. Calculating Adjusted Income:

• Use the revised mandatory deductions and income exclusions to calculate residents’ adjusted income accurately. This directly affects rent calculations and subsidy amounts.

3. Using the Passbook Savings Rate:

• The new rate of 0.45% applies to any assets exceeding $51,600. This ensures consistent treatment of imputed income across programs.

Preparing for Full Implementation

While the CY2025 HUD Updates values are effective starting January 2025, full HOTMA compliance is expected by July 2025. We advise waiting for the necessary software updates before fully implementing the changes. Early training and mock calculations can help your team prepare for the transition.