RAD/Section 18 blend calculator
How much more rent, and debt, does a RAD/Section 18 blend bring than converting every unit under RAD? Enter the RAD rent, the FMR-based voucher rent and the Section 18 share; you get HUD's blended rent, the revenue gain and the loan each supports.
Worked example: 100 units with a $1,100 RAD rent and 30% under Section 18 at a $1,440 voucher rent blend to $1,202 a month, $122,400 a year more than all-RAD, and support about $1,590,000 more FHA debt.
70 RAD units and 30 Section 18 units
Blended rent $1,202 a month- TPV unit rent (110% FMR less UA, or reasonable rent)
- $1,440
- Revenue gain over all-RAD, per year
- $122,400
- Debt, all units under RAD
- $7,037,705
- Debt with the blend
- $8,628,060
- Added debt from the blend
- $1,590,355
| Section 18 share | Section 18 units | Blended rent | Debt supported |
|---|---|---|---|
| 0% | 0 | $1,100 | $7,037,705 |
| 10% | 10 | $1,134 | $7,567,824 |
| 30% | 30 | $1,202 | $8,628,060 |
| 60% | 60 | $1,304 | $10,218,416 |
| 90% | 90 | $1,406 | $11,808,771 |
How this works
- Units. Section 18 units = units x share, rounded; the rest convert under RAD. At least 10% must convert under RAD (PIH 2026-23, Section III.C).
- TPV unit rent = the lower of 110% of the FMR (or approved exception payment standard) minus the utility allowance, or the reasonable rent (Supplemental Notice 4C, Section II.6).
- Blended rent = (RAD units x RAD rent + Section 18 units x TPV rent) / all units. HUD does this by bedroom; enter bedroom-weighted averages, or run each bedroom size.
- Debt = net operating income / DSCR / annual debt constant, with FHA's 0.25% MIP (90 FR 45789). Defaults are FHA's terms for properties with 90% or more of units assisted: 1.11 coverage, 3% vacancy (ML 2025-03), 35 years (MAP Guide 3.1.6). The 5.54% rate is an illustrative placeholder.
The rules this applies
- Share caps (Notice PIH 2026-23, August 28, 2026, which amends PIH 2024-40): up to 90% Section 18 when rehab hard costs exceed 90% of HUD's Housing Construction Costs for the market, when the project is demolished and redeveloped, or when assistance transfers; up to 60% above 60% of HCC; up to 30% above 30%. Small PHAs with 250 or fewer ACC units may go to 90% with a Repositioning Plan their board approves.
- Vacant units and TPVs (Notice PIH 2026-12, first issued May 6, 2026, revised June 9, 2026): in 2026, replacement TPVs cover vacant units only if an assisted family lived there in the previous 12 months, down from 24. Blends whose RAD Financing Plan was submitted before the notice took effect keep 24 months. HUD says it may suspend vacant-unit TPVs if demand outruns funding. This is read from HUD's notice itself (primary source).
- One contract. All blend units convert to the same form, PBV or PBRA, under one RAD HAP contract and one RAD Use Agreement (4C, Section II.2.d).
What it leaves out: HUD's bedroom-by-bedroom schedule, other rent flexibilities (MTW funds, rent bundling, DDTF, utility allowance savings), the PBV or PBRA rent caps that apply to the RAD units, and Section 18 approval itself. For a project's own HUD blend estimates, use the RAD rent check.
Questions people ask
How does HUD set the rent in a RAD/Section 18 blend?
Supplemental Notice 4C (January 16, 2025) has HUD produce one blended rent schedule for all units: the unit-weighted average, by bedroom, of the RAD rents for the units converting under RAD and, for the units converting with tenant protection vouchers, the lower of 110% of the FMR (or an approved exception payment standard) minus the utility allowance, or the reasonable rent.
What share of a project can go under Section 18?
Under Notice PIH 2026-23 (August 28, 2026): up to 90% where rehab hard costs exceed 90% of HUD's Housing Construction Costs for the area, or the project is demolished and redeveloped, or assistance transfers to a new site; up to 60% where hard costs exceed 60% of HCC; up to 30% where they exceed 30%. A PHA with 250 or fewer public housing ACC units may dispose of up to 90% with a board-approved Repositioning Plan. At least 10% must convert under RAD in every case.
Did the TPV rules change in 2026?
Yes. Notice PIH 2026-12 (first issued May 6, 2026) provides replacement TPVs in 2026 for vacant units only if an assisted family occupied them in the previous 12 months, down from 24. A RAD/Section 18 blend whose Financing Plan was submitted before the notice took effect keeps the 24-month rule. Enter any Section 18 units that miss the window and the sketch drops their voucher rent.
Is the blend PBV or PBRA?
Either. Since 4C, the RAD units and the TPV units convert to the same form of assistance under a single RAD HAP contract and one RAD Use Agreement.
Sources
- HUD Notice H-2025-01 / PIH-2025-03, RAD Supplemental Notice 4C (January 16, 2025) Section II: blended rent schedule is the unit-weighted average of RAD rents and, for TPV units, the lower of 110% of FMR (or exception payment standard) less utility allowance, or reasonable rent. Section X: leveraged deals should keep DSCR at 1.11 or more over ten years at 2% revenue and 3% expense growth.
- HUD Notice PIH 2026-23, Demolition and/or Disposition of Public Housing Property (August 28, 2026) Section III.C: construction blend tiers (up to 90%, 60% or 30% Section 18 by hard cost against HUD Housing Construction Costs, or 90% for redevelopment, transfer of assistance and other cases); small PHA blend (250 or fewer ACC units) up to 90%; at least 10% must convert under RAD.
- HUD Notice PIH 2026-12, Revision 2 (CY 2026 Housing Choice Voucher funding) (issued May 6, 2026; revised June 9, 2026) Section IV.D: replacement TPVs for vacant units only if last occupied in the previous 12 months (was 24). RAD/Section 18 blends whose Financing Plan was submitted before the notice took effect keep the 24-month rule.
- HUD Mortgagee Letter 2025-03, Multifamily Changes in DSCR and LTV/LTC Ratios (January 8, 2025) Properties with 90% or more of units under rental assistance: 90% loan ratio, 1.11 DSCR, 3% vacancy factor, for both 221(d)(4) and 223(f). LIHTC with a rent advantage: 90% and 1.11. Market rate: 87% and 1.15.
- HUD notice, Changes to Mortgage Insurance Premiums for FHA Multifamily Programs (90 FR 45789, FR-6522-N-02) (September 23, 2025) Annual MIP of 0.25% for all FHA multifamily programs, for applications submitted or amended on or after October 1, 2025.
This is a sizing sketch, not a loan offer, a commitment or advice. Rates shown are illustrative inputs you can change; this site advertises no rates or terms. Lenders, HUD and investors underwrite with their own figures and current guides. Janover Capital LLC is a commercial mortgage advisor, not a lender, and is not affiliated with HUD.
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