Deep Dive: Next Steps for HUD's Physical Inspection Overhaul

Regulation | February 01, 2021 | by Juliana Bilowich

HUD’s new NSPIRE rule proposes first steps in sweeping physical inspection overhaul; LeadingAge’s detailed analysis now available.

On January 19, HUD published a proposed rule to begin implementation of sweeping changes to its physical inspection protocol and standard, called the National Standards for the Physical Inspection of Real Estate (NSPIRE). The proposed changes will affect senior housing residents, staff, and owners for decades to come.

LeadingAge’s detailed analysis of the NSPIRE proposed rule, as well as an overview of the sweeping oversight changes on the horizon for senior housing providers, is now available. LeadingAge is compiling comments on the proposed rule to submit to HUD by the March 15th deadline. Please send any specific comments on the proposed rule, or general feedback on physical inspections, standards, or HUD oversight, to jbilowich@leadingage.org.

The proposed rule runs parallel to the ongoing NSPIRE demonstration program, in which many LeadingAge members are participating. LeadingAge is also convening a small workgroup of senior housing provider members to inform HUD’s changing approach to portfolio oversight.

Notable proposed changes to HUD’s physical property oversight include:

  • Self-Inspections: Explicitly requiring housing providers to annually self-inspect all units and report the results electronically to HUD;
  • Risk-Based Schedule: Extending the current risk-based inspection schedule from the current one-three years to two-five years;
  • Reinspection Fees: Allowing reinspection fees to be charged of owners if, during the reinspection, reported or required repairs are not found to have been made;
  • Tenant Input: Increasing tenant input by allowing tenants to rate their units or submit them for inspection;
  • Definitions and Applicability: Consolidating the definition of housing quality requirements and expanding HUD programs covered by the requirements;
  • Owner Responsibilities: Replacing “Exigent Health and Safety” with “Severe Health and Safety” for the most serious deficiencies and updating default repair timeframes;
  • Mixed Finance Properties: Aligning inspection approaches for HOME and Housing Trust Fund (HTF)-assisted properties with other HUD programs
  • Inspectable Area and Tenant-Induced Damage: Adjusting the inspectable areas during physical inspections, with a heavier emphasis placed on in-unit areas and livability for residents, and seeking feedback on fairly approaching tenant-induced damage;
  • Continual Updates: Establishing an official method for physical inspection components to be regularly and publicly updated by HUD with input from stakeholders;
  • Affirmative Safety Standards: Proposing new, proactive housing standards, including electrical outlets and lights, and setting standards for kitchens, bathrooms, and safe drinking water; and
  • NSPIRE Implementation: Setting out how impending inspection overhaul provisions (standards, scoring, and protocol changes related to NSPIRE) will be handled by HUD during the remaining NSPIRE implementation.

To read LeadingAge's detailed analysis, click here. More information about NSPIRE is available at HUD’s webpage here; the proposed rule is available to read here.