California Code of Regulations › Title 4 - Business Regulations › Division 9.5 - California Debt Limit Allocation Committee › Chapter 2 - Qualified Residential Rental Projects › Article 4 - Market Studies › Section 5200 - Minimum Requirements - Market Study

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The Market Study shall meet the current guidelines as
					 required by the California Tax Credit Allocation Committee (CTCAC) in
					 California Code of Regulations, Title 4, Section
					 10322(h)(10).
(a) A full Market Study with a Rent
				  Comparability Matrix for each applicable unit type prepared within (180) days
				  of the Application deadline by an independent third party having no identity of
				  interest with the Applicant, Project Sponsor, or Related Party is
				  required.
(b) The study must
				  establish both need and demand for the proposed Project. If the Market Study
				  does not support sufficient need and demand for the Project, the Application
				  may be considered ineligible to receive an award of Allocation.
(c) A market study shall be updated when
				  proposed subject project rents change by more than five percent (5%), or the
				  distribution of higher rents increased by more than 5%, or 180 days have
				  elapsed between the earliest site inspection date for the subject property or
				  comparable properties and the application submission deadline for the round in
				  which the Project is seeking an allocation. CDLAC shall not accept an updated
				  market study when more than twelve (12) months have passed since the earliest
				  listed site inspection date of either the subject property or any comparable
				  property. In such cases, applicants shall provide a new market study.
(d) Acquisition/Rehabilitation projects
				  subject to an existing Residential Rental Regulatory Agreement or a federal,
				  state, or local operating or rental assistance agreement may provide, as an
				  alternative to providing a market study and affordability matrices consistent
				  with Section
				  5200(a), a
				  comprehensive market study consistent with
				  26 U.S.C. Section
				  42(m)(1)(A)(iii). The study
				  shall be a written statement, certified by a third-party market analyst, which
				  includes a current rent roll. In addition, the project shall meet at least one
				  of the following requirements:
(1) as
				  certified by a third-party market analyst, the proposed tenant paid rents and
				  income targeting will not exceed one hundred-five percent (105%) of the current
				  rents and targeting and a vacancy rate of no more than five percent (5%); for
				  single room occupancy and special needs housing a vacancy rate of no more than
				  ten percent (10%); or
(2) as
				  evidenced by copies of executed contracts, that the Project has been receiving
				  federal, state, or local operating or rental assistance and will continue to
				  receive such assistance for at least five (5) additional years. If a contract
				  demonstrating operating or rental assistance for an additional five (5) years
				  is not available, a letter signed by the contractor's senior official may be
				  submitted that describes the efforts undertaken to effectuate an operating or
				  rental assistance contract, the expected duration of the contract, and the
				  expected contract execution date.