LIHTC in Real Estate Management

Managing LIHTC properties is different — and more challenging — than managing other multifamily properties, especially those with no federal subsidies.

1. Much of the real estate manager’s time and resources are devoted to ensuring compliance with the LIHTC program.
2. Sometimes, staff and financial resources are inadequate for all the tasks associated with LIHTC compliance and other real estate management functions.
3. Documentation and record keeping are essential.
4. While the owner is ultimately responsible and liable for the property, the real estate manager may have responsibility for social service programs on the site.
5. Verifying income, assets, and household composition with LIHTC tenants is often an invasive process that requires tact, diligence, and persistence.
6. Agencies and organizations — including the SHFA, syndicators, and owners — often require different formats and different schedules for reporting, which requires time and administrative work.
7. Keeping informed of changes and updates to the rules of the LIHTC program requires ongoing training, a strong professional commitment, and time.
8. Developing and writing a comprehensive management plan for an LIHTC property will require more than just normal real estate management considerations — LIHTC adds many more variables and challenges.
9. Finding qualified tenants is challenging, as those tenants must meet minimum income limits established by the owner but cannot exceed the maximum income limit according to LIHTC program rules. Therefore, marketing can be a challenge, requiring additional time and resources. The subject of income limits will be covered in detail in the next lesson.
10. With new construction projects, real estate management may find and qualify applicants only to have the building delivered for occupancy four or five months late, by which time those qualified applicants have left for occupancy at the nearby competition. While construction delays are beyond the control of real estate management staff, management is still accountable for delivering qualified tenants when the building is finally ready for occupancy.

Perhaps the greatest challenge in managing LIHTC properties is finding the time and resources to ensure compliance and perform normal property management duties such as preventive and corrective maintenance.

Best Practices: Property management and compliance software may be the best way to manage all the duties associated with an LIHTC property. Following is a list of vendors:

• Yardi Systems, Inc.
• Bostonpost Technology Inc.
• Domin-8 Enterprise Solutions
• TrackPro Services
• TCG Technologies, LLC