Preserving Existing Affordable Housing

Potential conversion of affordable housing to market-rate housing is an ongoing and critical statewide problem. In California, there are approximately 149,000 units of privately owned, federally assisted, multifamily rental housing, plus additional tax-credit and mortgage-revenue bond properties, many with project-based rental assistance. A large percentage of these units may convert to market rate as subsidy contracts or regulatory agreements expire. These at-risk units are home to seniors and families with lower incomes who cannot afford to pay market-rate rents and who could be displaced if the developments convert. Affordable Rental Housing at Risk of Conversion (PDF) provides an overview of this issue in California.

State Preservation Notice Requirements

Owners of specified, federally assisted projects are required, unless exempted, to provide "notices of intent" to prepay a federally assisted mortgage, terminate mortgage insurance, or terminate rent subsidies or restrictions at twelve and six months to all affected households and to affected public agencies (California Government Code (GC) Section 65863.10 (b) and (c)).

Affected public agencies include the city or county where the development is located, the local public housing authority, and the California Department of Housing and Community Development (HCD) (GC Section 65863.10 (a)).

All notices to affected tenants and affected public agencies must be made by first-class mail postage prepaid.

Owners of government-assisted developments cannot terminate subsidy contracts, prepay a federally assisted mortgage, or discontinue use restrictions without first providing an exclusive "notice of opportunity to submit an offer to purchase" to each identified qualified entity (GC Section 65863.11(g)).

The notices to qualified entities must be made by registered or certified mail, return receipt requested. The owner shall also post a copy of the notice in a conspicuous place in the common area of the development.

The following link is to a chart that provides a brief overview of state notice requirements:

Links to California Government Code Sections 65863.10, 65863.11, and 65863.13.

Contact the Division of Housing Policy Development at (916) 263-2911 for additional information.

Sample Notices and Letters

View list of notices (six- and twelve-month) received by HCD (XLS). HCD makes no representation of the accuracy or compliance with statutory notice provisions.

Qualified Entity Information

Partnership Links

Learn how local governments and nonprofit organizations can request access to the California Housing Partnership's database of at-risk affordable developments.