HUD Further Delays Certain Provisions of HOME Final Rule, Including Tenant Protections

On April 17, HUD announced another delay to portions of its updated HOME Investment Partnerships Program (HOME) Final Rule. This follows an earlier postponement announced in February 2025, when HUD pushed the rule’s original Feb. 5 effective date to April 20. That initial delay was procedural, prompted by the Trump administration’s Jan. 20 “Regulatory Freeze Pending Review” memorandum, which required federal agencies to pause pending rules for review. At the time, HUD said the delay was strictly procedural and that the delay merely allowed for additional internal evaluation.

The HOME program, the largest federal block grant for affordable housing, is frequently used alongside the Low-Income Housing Tax Credit (LIHTC) program to finance affordable rental developments. LIHTC provides equity through tax credits but often leaves a funding gap that HOME funds are used to fill. Nearly 17 percent of LIHTC properties also receive HOME assistance, meaning changes to HOME program regulations can have a substantial impact on LIHTC-supported projects.

The HOME Final Rule, published on Jan. 6, 2025, represented the most significant update to HOME regulations in over a decade. It aimed to streamline requirements, align HOME more closely with other federal housing programs, and incorporate statutory changes, while also making minor revisions to the Community Development Block Grant (CDBG) and Section 8 Housing Choice Voucher programs to ensure consistency across HUD initiatives. As the review process has unfolded, HUD’s April 17 announcement introduces a second, more targeted delay, affecting only select provisions of the final rule.

Although most of the rule became effective on April 20, 2025, HUD postponed the effective date of two significant provisions until Oct. 30, 2025. The delay affects the rule’s green building subsidy revisions and its expanded tenant protection requirements, both of which will be subject to additional public comment before taking effect.

While the delay affects these two areas, the rest of the HOME Final Rule is now effective. Participating jurisdictions must comply with the updated requirements by April 20, 2026, which preserves the original one-year transition period despite the overall delay caused by the regulatory review.

Green Building Incentive Delayed

HUD’s HOME Final Rule introduces a new green building incentive, allowing a maximum 10 percent increase in the per-unit subsidy limit for projects that meet specified green and resilient building standards. This measure was designed to encourage the incorporation of energy-efficient and resilient construction practices in affordable housing, ultimately lowering energy costs and improving long-term sustainability for residents. HUD was to publish the specific green and resilient building standards that projects must meet to qualify for the increased subsidy in the Federal Register.

However, the April 17 notice delayed the green buildings subsidy provision and is now scheduled to take effect on Oct. 30, 2025. HUD says it will issue a separate Federal Register notice to provide further guidance and may invite public comment before this date.

Further Public Review for Expanded Tenant Protections

HUD’s delay to implement the enhanced protections for tenants in HOME-assisted properties has drawn the most attention. Once implemented, the HOME Final Rule will require that all leases for HOME-assisted units include a standardized tenancy addendum, clearly laying out tenant protections. Tenants would have enhanced protections against retaliation, more transparent notice requirements when facing lease terminations or rent increases, and strengthened privacy rules governing unit entry.

In addition, owners would be prohibited from discriminatory practices limiting HOME tenants’ access to common areas, and new rules would establish standards for maintaining units and properties in safe and decent condition. And in cases where immediate life-threatening conditions cannot be repaired, owners would be required to relocate affected tenants at no additional cost.

The tenant protections also explicitly affirm tenants’ rights to organize and participate in tenant associations without fear of harassment or retaliation. Owners are barred from engaging in practices such as constructive eviction or selective enforcement of rules to undermine tenant advocacy efforts. Security deposit practices would be more tightly regulated as well, with caps on deposit amounts and prohibitions on requiring security deposit insurance products.

The tenant protections are now set to take effect on Oct. 30, 2025, to allow for further HUD review and public comment. In the meantime, HUD clarified that existing tenant protections under current HOME rules remain in force. Owners are still permitted to terminate or refuse to renew tenancies without a 30-day notice in cases where there is a direct threat to health, safety, or property, provided such action complies with state and local law.

Finally, HUD took the opportunity in the April 17 notice to remind participating jurisdictions that HOME funds must be administered in compliance with immigration-related eligibility restrictions under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA). This legal compliance reminder wasn’t directly tied to the delayed provisions. It just reminded HOME recipients that they must continue to verify the immigration status of beneficiaries as required under federal law.