The Federal Housing Administration has announced that condominiums providing bank owned properties limited flexibility from transient leasing prohibitions are now eligible for FHA approval. CAI applauds FHA’s decision, which will make it easier for more condominiums to be certified by FHA.
Under FHA’s new policy, condominium associations in violation of FHA prohibitions on transient leasing are offered two compliance options:
1) The association may amend governing documents to remove bank owned property exemptions from transient leasing prohibitions, or
2) The association board may provide a dated and signed statement on association letterhead affirming that no units within the condominium project are leased for a term of less than 30 days and tenants are not provided services commonly associated with a hotel.
“I commend FHA for showing regulatory restraint and working proactively to find a solution to an issue that was critical for many CAI members,” said Tom Skiba, CAI’s Chief Executive Officer. “FHA’s new policy preserves the integrity of association governance while ensuring full compliance with federal law.”
CAI is coordinating with FHA on standard language that may be used to satisfy the required statement regarding transient or hotel leasing under the new policy. This language, accompanied by additional guidance, will be circulated to CAI members.
FHA has also announced a condominium stakeholders conference call on Friday, July 26, 2013. Senior FHA staff will discuss the agency’s condominium policy and respond to stakeholder questions.
“I encourage all CAI members with an interest in the FHA condominium approval process to participate in the FHA stakeholder conference call,” said Dawn Bauman, CAI’s Senior Vice President for Government and Public Affairs. “FHA condominium approval is important for many condominiums and FHA staff will benefit from direct engagement with CAI members.”
To read the FHA announcement, click here.
FHA Condominium Stakeholders Conference Call Information
Date: Friday, July 26, 2013
Time: 2:30 to 3:30 PM Eastern Daylight Time
Number: (800) 260-0719
Participants are encouraged to join the conference call at least 15 minutes in advance as the call will begin promptly at 2:30 PM Eastern Daylight Time.