24 C.F.R. § 891.863
§ 891.863 Maintenance as supportive housing units for elderly persons and persons with disabilities. (24 CFR Part 891)
Operative Text
(a) The mixed-finance owner must develop and continue to operate the same number of supportive housing units for elderly persons or persons with disabilities, as stated in the use agreement or other document establishing the number of assisted units, for a 40-year period. (b) If a mixed-finance development proposal provides that the Section 202 or 811 supportive housing units will be floating units, the mixed-finance owner must operate the HUD-approved percentage of Section 202 or 811 supportive housing units, and maintain the percentage distribution of bedroom sizes of Section 202 or 811 supportive housing units for the entire term of the very low-income use restrictions on the development. Any foreclosure, sale, or other transfer of the development must be subject to a covenant running with the land requiring the continued adherence to the very low-income use restrictions for the Section 202 or 811 supportive housing units. (c) The owner must ensure that Section 202 or 811 supportive housing units in the development are and continue to be comparable to unassisted units in terms of location, size, appearance, and amenities. If due to a change in the partnership structure it becomes necessary to establish a new owner partnership or to transfer the supportive housing project, the new or revised owner must be a single-purpose entity and the use restrictions must remain in effect as provided above.
Under 24 CFR Part 891 § 891.863, mixed-finance developments that include Section 202 or Section 811 supportive housing units must preserve those units for elderly persons or persons with disabilities over a 40-year period, maintaining the same count or approved percentage of such units as established in the governing use agreement. When supportive housing units are designated as 'floating' rather than fixed to specific apartments, the required percentage and bedroom-size distribution must be upheld for the full duration of the development's very low-income use restrictions, and any transfer of the property must carry those obligations forward through a recorded covenant. In all cases, the assisted units must remain comparable to unassisted units in the development with respect to location, size, appearance, and amenities.
Plain English — not legal advice.
Operators of mixed-finance developments subject to 24 CFR Part 891 § 891.863 generally ensure that the number or approved percentage of Section 202 or 811 supportive housing units is tracked and maintained continuously, consistent with the applicable use agreement. When a development uses floating units, compliant operators monitor both the percentage of assisted units and the distribution of bedroom sizes across the full term of the very low-income use restrictions, and they structure any sale, foreclosure, or ownership transfer so that a land covenant preserving those restrictions is recorded and runs with the property. Ownership restructurings that require forming a new entity are handled so that the successor is organized as a single-purpose entity and the use restrictions remain intact as required by this section.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
Section 24 CFR Part 891 § 891.863 establishes that residents of Section 202 or 811 supportive housing units within mixed-finance developments are entitled to units that are comparable to unassisted units in the same development in terms of location, size, appearance, and amenities—and that this protection, along with the overall supply of assisted units, must be maintained for an extended period. If a development is sold or transferred, the obligations protecting those units are required to carry over to the new owner, meaning a change in ownership does not extinguish residents' protections under this provision. Tenants who believe these standards are not being met may consider raising the issue with HUD, consulting a local tenant-rights organization, or exploring whether a violation of this section can be raised in relevant administrative or legal proceedings.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated September 4, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
Effective Timeline
References Out
No outbound references recorded yet for this provision.
References In
No inbound references recorded yet for this provision.