Last Thursday, Federal Housing Administration Principal Deputy Assistant Secretary Ed Golding and National Association of Realtors President Chris Polychron announced changes to FHA condominium policies at the NAR national conference in San Diego.
The changes, Golding explained, will change the FHA’s recertification process, owner-occupancy requirements and limits on the types of property insurance that are considered adequate under FHA’s rules.
NAR has been working closely with HUD to push for changes to the condo policy, and Polychron recently testified before Capitol Hill to bring attention to the case. Golding told Realtors at the event that changes related to recertification and insurance and would take place effective immediately. Under the short-term changes, condos that are second homes, but not the owner’s main residence, will be deemed owner-occupied units and count toward the 50 percent owner occupancy stipulation.
“Realtors and consumers got a welcomed piece of news today with HUD’s commitment to fix FHA’s condo policies and broaden opportunities for families to find a home,” Polychron said.
The changes will be valid for one year, but the FHA is working on a formal proposal to make permanent alterations to its limits on commercial space, spot approvals and owner-occupancy requirements. According to HUD, FHA condo loan endorsements plummeted to 22,800 in 2014, from 57,800 a year prior.