Top 10 REAC Inspection Deficiencies
HUD’s published list of most common issues for inspections offers insights in how best to prepare your affordable housing asset for its next check-up.
Affordable housing communities insured by the Department of Housing and Urban Development are, as we’ve previously covered, subject to periodic inspections by HUD’s Real Estate Assessment Center. The organization conducts about 20,000 inspections every single year, and knowing what inspectors are assessing is a critical component to ensure that you, as an affordable housing owner or operator, are providing safe and secure housing.
Between early 2020 and mid 2021, REAC inspections largely ground to a halt, owing to the novel coronavirus pandemic. Although the group jumpstarted inspections late last year, a huge backlog of deferred inspections awaits. To address this backlog and some evidence of conditions deteriorating across the nation’s affordable housing inventory, REAC plans to inspect nearly all HUD-insured properties by the end of this year.
So, if you’re preparing your asset for a REAC inspection, what areas should you focus on? Generally, health and safety concerns are given significant weighting in an inspection, but what are the most common slip ups reported by REAC inspectors? Check out our list below of the 10 most common deficiencies reported, based on data from HUD.
10. Kitchen Functionality
The kitchens in your property’s units are among the most frequent places inside an apartment where a REAC inspector may notice an issue. It’s hardly surprising — given the intricacies of plumbing, electrical systems and often gas lines, there’s a lot of room for something to go wrong. And if something does go wrong, it could be potentially life threatening. With this in mind, inspectors pay very close attention to the safety and functionality of a kitchen’s built-in appliances. The stove, in particular, is cited as one of the most common reasons to lose points during an inspection. Ensure all knobs are connected and that burners operate properly.
9. Security Doors
Your community’s security doors may see a lot of use, particularly in large properties with multiple units, and they are a critical safety component of a building. HUD notes that security doors must not be fitted with dual-side key locks — after all, in the event of an emergency, requiring a key to exit a property could be extremely dangerous.
8. Damaged Door Hardware
Door issues account for three items on our list. Basic functionality of a door’s hardware — meaning handles, hinges, latches, and locks — is imperative for a good inspection. Prior to inspection day, ensure that all mechanisms in your exterior and fire doors work without a hitch to ensure top marks.
7. Damaged Door Seals
For our last door-related problem on this list, door seals can be a significant issue that a community owner should address. Damaged or broken door seals not only cause significant discomfort to a resident — particularly in regions with cold winters — but they also can lead to higher energy costs both for residents and a community’s common areas.
6. Open Breaker/Fuse Ports
This issue is pretty straightforward: Within your circuit breaker or fuse box, all open ports must be covered. Leaving ports open could present an electrical safety hazard.
5. Missing Electrical Covers
Another potential electrical hazard, your property’s electrical panels must have covers in place to avoid anything coming into contact with wiring and connections. This includes not only a circuit breaker box but any electrical junctions, both within units and in a community’s common areas.
4. Accessibility of Electrical Panels
While those panels must be covered, they must also be accessible. If furniture is blocking access to a wiring junction or other electrical panel, this is very likely to lead to a reduced score. This is not to say that nothing may be around a panel, however — the main criterion is that objects near a panel must be easily removed. A large desk or a fridge should not block access to a panel, for example, but something smaller and lighter — say, an office chair or a nightstand — is likely perfectly fine.
3. Missing HVAC Covers
The main concern with HVAC systems concerns covers for baseboard heating. If baseboard heating systems are utilized in your property, make sure they are in good working order. This means that the system covers should be securely in place. Without covers in place, an inspector may identify burn hazards — or even issues relating to sharp edges — which could significantly impact your overall score.
2. Misaligned Chimneys
Building systems are a potential area for significant losses in terms of inspection scoring. One of the most common building system issues is the presence of chimneys or other ventilation systems that are not aligned with what they’re meant to vent.
Consider: Do your systems like furnaces or water heaters have ventilation ducts or chimneys in place to capture exhaust? If there is even a slight disconnect or misalignment between these devices and their exhaust systems, it could raise safety concerns your inspector may flag.
1. Water Heater
While there are several concerns relating to water heaters — particularly with ventilation for those using gas — the most common deficiency in a REAC inspection is specific to the placement of water heaters’ pressure relief discharge tube. The end of this tube must be within 18 inches of the floor. Any higher up, and you could lose serious points on your inspection. However, make sure the pipe doesn’t terminate too close to the floor, either. Any discharge from the pipe should be readily observable to identify any issues in your water heater operations.
What are the most common REAC inspection deficiencies?
The most common REAC inspection deficiencies are related to kitchen functionality and water heaters. For kitchen functionality, inspectors pay close attention to the safety and functionality of a kitchen’s built-in appliances, such as the stove. For water heaters, the most common deficiency is related to the placement of the water heaters’ pressure relief discharge tube, which must be within 18 inches of the floor. Source
What are the consequences of failing a REAC inspection?
Failing a REAC inspection can have serious consequences for a property. The property may be subject to fines, and the owner may be required to make costly repairs to bring the property up to code. Additionally, the property may be subject to more frequent inspections in the future, and the owner may be required to submit a written appeal with evidence to challenge the score. Source
What are the steps to prepare for a REAC inspection?
To prepare for a REAC inspection, you should have the following items on hand:
- Certifications for boilers, fire alarms and sprinkler systems, elevators, etc.
- Measurements for all roadways (including parking lots and driveways) and walkways/stairs (in square feet)
- Rent roll as of the date of inspection
- Site map (generally only for larger properties with multiple buildings)
- Lead-based paint report (only if any buildings were constructed before 1978)
The inspector will also ask a series of questions and request a number of data points about your property. Conducting repairs on inspection day is generally prohibited, but you may take a few actions to improve your score, such as installing a light bulb, lighting a pilot light on a gas burner, plugging electric stoves in, finding and installing knobs for gas or electric stoves, and plugging in bathroom exhaust fans.
Inspectors are required to point out any aspects which will negatively affect a score. This is not a time to argue or challenge any facet of the inspection — however, it can be a great opportunity to note any and all factors that you may appeal in writing once a final score is issued by REAC.
What are the most important items to check during a REAC inspection?
The most important items to check during a REAC inspection are the certifications for boilers, fire alarms and sprinkler systems, elevators, etc., measurements for all roadways (including parking lots and driveways) and walkways/stairs (in square feet), rent roll as of the date of inspection, site map (generally only for larger properties with multiple buildings), and lead-based paint report (only if any buildings were constructed before 1978).
In addition, the inspection includes checks of the site as well as the asset’s exterior, common areas, and building systems. A nonexhaustive list of inspectable items for each of these sections is provided in the image.
What are the best practices for passing a REAC inspection?
The best practices for passing a REAC inspection include:
- Prior to the inspection, provide the inspector with all requested data points.
- Allow the inspector to conduct a thorough inspection of the property's site, building exteriors, building systems, common areas, and units.
- Do not conduct repairs on inspection day, as this may negatively affect the score.
- If a resident refuses entry to an inspector, choose an alternate unit.
- During the inspection, the inspector may point out any issues that may negatively affect the score. Address any life-threatening problems within 24 hours.
- If you have an issue with the final score, submit a written appeal with evidence.
For more information, please refer to the REAC Inspection Checklist.
What are the differences between a REAC inspection and a regular inspection?
A REAC inspection is a specialized inspection conducted by the U.S. Department of Housing and Urban Development (HUD) to assess the condition of affordable housing communities. The inspection includes checks of the site as well as the asset’s exterior, common areas, and building systems. A number of units will be randomly selected by a computer system for the inspector to view. The results of the inspection are given an overall score between zero and 100, with anything above a 60 being considered a passing score. The score also determines how often the property will be inspected in the future. Properties may also be given a letter (“a”, “b”, or “c”) to indicate the presence of any health and safety deficiencies. Inspectors are required to point out any issues that may negatively affect the score, and owners have 24 hours to address any life-threatening problems. If an owner has an issue with the final score, they may submit a written appeal with evidence.
A regular inspection is typically conducted by a private inspector and is used to assess the condition of a property. The inspector will check the property’s exterior, interior, and systems to ensure that they are up to code and safe for occupancy. The inspector will also check for any potential safety hazards and make recommendations for repairs or improvements. The inspector will provide a report with their findings and recommendations.