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Preparing for New REAC Realities: A Time to Re-Exam Your Policies and Procedures

With the onset of the new 14-day notice REAC Inspection rule; it is time for management companies and owners to develop new metrics for physical compliance. A large portion of the intent of the new HUD initiative is to end what they refer to as "Just in Time" repairs and the practice of owners/agents simply operating their properties under the guise of preparing for the exam, instead of looking at the quality of their communities.

While the presumption that the entire industry operated their properties in this manner is deeply flawed, the perception has resulted in a set of new challenges for the industry.

At this moment, owner/agents need to develop a new set of metrics and operating standards to address REAC readiness on an everyday basis. Many in the industry have developed procedures that rely on the last REAC score to determine if a property is ready or in need of additional attention. However, many REAC Inspections were deeply flawed due to poor quality and inconsistent results, making these inspections a poor standard for risk rating.

We, at US Housing Consultants, are working with a number of companies who are now developing new maintenance operating procedures. These policies procedures are creating new standards and policies for physical compliance, creating:

  • Layers of internal inspections
  • Quality control procedures
  • REAC compliance training
  • Work order policies
  • Risk analysis ratings to determine how frequently, and when, a property needs to be reviewed for its REAC readiness.

This policy, and ones like it, are an important part of preparing for new, deeper analysis of physical compliance. Previous results, as hard-won as they may have been, were built on an older set of expectations and procedures, and continuing to use those approaches could expose owners/agents to non-compliance. With new levels of scrutiny on physical conditions of HUD and Tax Credit properties, owners/agents need to bring a new level of seriousness to maintenance.

In the coming years, there are more reforms to REAC expected; owners/agents need to take this moment to take a careful look at their policies and procedures. Are the standards of owners/agents based upon past expectations, or what the future holds? If owners/agents are preparing for the rules of the past, the future may contain high levels of risk and uncertainty.

If you should have any questions about what physical compliance policies would look like for your company, please contact me at This email address is being protected from spambots. You need JavaScript enabled to view it. for a free discussion and review. 

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