What is Market Rate Housing?

Market Rate Housing and HUD 221(d)(4) Loans

Market rate housing consists of non-subsidized properties that are rented or owned by those who pay market rate rents or who paid market value to purchase the property. This is in contrast to both affordable housing and subsidized affordable housing, as both of these types of housing types confer special benefits upon HUD 221(d)(4) loan borrowers. For example, while market rate properties are allowed a maximum 85% LTV, affordable properties are permitted an 87% LTV, and properties with 90% or more low-income units (typically subsidized housing) are permitted up to 90% LTV.

In addition, certain affordable properties can make use of the LIHTC (Low-Income Housing Tax Credit Program), which offers a 10-year federal income tax credit to property owners/investors.


To learn more about HUD multifamily construction loans like the HUD 221(d)(4) loan, fill out the form below and a HUD lending expert will get in touch.