Occupancy Standards | HACLA (2024)

FAQs

What is reasonable occupancy usually defined as? ›

Some states, like California, will dictate what should generally be considered to be a reasonable occupancy standard. California says that two-persons-per-bedroom-plus-one is a reasonable rule.

However, landlords may consider credit history as part of their tenant screening process, but they cannot use it as the sole basis for denying Section 8 applicants. This is outlined in the California Senate Bill 267, which aims to prevent discrimination against Section 8 voucher holders.

In addition, HUD will look at the age of children, configuration of the unit, and any physical limitations of the housing—such as the capacity for septic, sewer, or other building system—to determine whether an occupancy policy is too restrictive.

HUD Occupancy Limit

The HUD occupancy guideline serves as a reference for state and local laws. It specifies a maximum of 2 persons per room and excludes children from the occupancy limit.

A limit on the number of persons allowed per dwelling unit, based on the size of the unit, number of bedrooms and baths, and other factors, such as physical limitations of the building.

For some, it can be between a range of 70-95%, though the best occupancy rate may depend on multiple factors like the hotel's location, no. of rooms, room rates, service, etc.

The credit score used in mortgage applications

While the FICO^® 8 model is the most widely used scoring model for general lending decisions, banks use the following FICO scores when you apply for a mortgage: FICO^® Score 2 (Experian) FICO^® Score 5 (Equifax) FICO^® Score 4 (TransUnion)

Within 30 days of being refused the rental, you can ask the credit reporting agency for a free copy of your credit report. You can then dispute any incorrect information. A landlord cannot engage in illegal discrimination.

Every landlord and property manager has different criteria to approve a new tenant. Landlords generally prefer a minimum credit score of at least “good,” which is 670 to 739. A score at or above that range will make apartment applications easier.

It is illegal discrimination to take any of the following actions because of race, color, religion, sex (including gender identity and sexual orientation), disability, familial status, or national origin: Refuse to rent or sell housing. Refuse to negotiate for housing. Otherwise make housing unavailable.

What are the examples of housing discrimination? ›

Refusal to negotiate for the sale, rental, or lease of housing. Informing someone that an apartment is not available for inspection, sale, or rental when it is in fact available. Denial of a home loan or homeowner's insurance. Cancellation or termination of a sale or rental agreement.

For example, California goes beyond the typical two-person per bedroom and employs what is known as the 2+1 standard.

For a room to count as a true bedroom, it must have at least 70 square feet of floor space with a minimum of 7 feet in one direction.

While the specific occupancy limits vary by state and property, many properties employ HUD's suggested standard: two people per bedroom. Though this standard is not law, HUD promotes this limit as a reasonable occupancy rule for most properties.

Overcrowding is typically defined as more than one person per room, based on the Census Bureau's definition of “room,” which excludes bathrooms, porches, balconies, foyers, halls, or half-rooms. Severe overcrowding occurs when there are more than 1.5 persons per room.

For many hotels, an ideal occupancy rate is between 70% and 95% - though the sweet spot depends on the number of rooms, location, type of hotel, target guests, and more.

Average Occupancy is based on monthly occupied net rentable square footage or monthly occupied multifamily units as a percentage of total net rentable square footage or total multifamily units, respectively.

While this percentage can vary widely depending on the type of business and its location, a common rule of thumb in a competitive market is that a healthy occupancy cost percentage should not exceed 10% for an office tenant and 5-10% for a retail tenant.