LIHTC Properties See Rent Growth Slow in 2021

Novogradac analysis of 125,000 units also finds notable increase in operating expenses.

Rental income at low-income housing tax credit (LIHTC) properties increased slightly in 2021, but that was offset by a larger jump in operating expenses, according to a new study by national accounting and consulting firm Novogradac.

An analysis of more than 125,000 LIHTC units revealed that rental income increased 0.8% in 2021 over the prior year, hitting a new record of $9,702 per unit.

However, that increase was outweighed by a larger 4.3% jump in operating expenses, which led to the first one-year drop in median net operating income (NOI) since 2017 for the properties tracked by Novogradac.

As a result of the slight increase in income and larger increase in expense, the NOI fell by 4% in 2021.

The latest analysis digs into data from a period when the nation was emerging from the COVID-19 pandemic and reflects changes in the different markets.