Part I: Minimum Property Standards for One- and Two-Family Dwellings

by U.S. Department of Housing and Urban Development

Part 1
Minimum Property Standards
for One- and Two- Family Dwellings
Part 1 of a Study of the HUD
Minimum Property Standards for One- and Two- Family Dwellings
and Technical Suitability of Products Programs
Prepared for the
U.S. Department of Housing and Urban Development
Office of Policy Development and Research
by the
National Institute of Building Sciences
March 2003

Acknowledgments
The principal investigator for this study was William Brenner of the National Institute
of Building Sciences. Background research was performed by Building Technology
Inc. and Steven Spector. The Institute is grateful for the help and guidance of William
Freeborne and David Engel of HUD’s Affordable Housing Research and Technology
Division; Elizabeth Cocke, Rick Mendlen, Vincent Tang, and Jason McJury of HUD’s
Office of Manufactured Housing Programs; and retired HUD employees Mark
Holman, Robert Fuller, Sam Hakopian, and Leslie Breden.
The Institute thanks the following reviewers for their thoughtful comments and
insights: Liza Bowles, Newport Partners LLC; Ron Burton, BOMA International;
David Conover; Rosemarie Geier Grant, State Farm Insurance Companies; Paul
Heilstedt, BOCA International; Ron Nickson, National Multi Housing Council; Ed
Sutton, National Association of Home Builders; and Gene Zeller, City of Long Beach,
California.
The National Institute of Building Sciences appreciates the opportunity to study these
long-standing HUD programs and hopes the findings and recommendations herein
will be helpful in addressing the needs the programs have traditionally served.
Disclaimer
The study’s findings are solely those of the National Institute of Building Sciences
and do not reflect the views of the U.S. Department of Housing and Urban
Development, the study’s participants, or its reviewers. The Institute has made every
effort to verify the accuracy of the study’s content, but no guarantee of the accuracy or
completeness of the information is either offered or implied.
Prepared under Contract C-OPC-21204 between the U.S. Department of Housing
and Urban Development and the National Institute of Building Sciences

TABLE OF CONTENTS
1. Introduction ................................................................1
2. History of the MPS Program ...................................................2
The 1920s and 1930s .....................................................2
The 1940s and Early 1950s ................................................4
1958 to 1980: Expansion of the MPS ........................................5
1980 to present: Decline of the MPS .........................................7
3. Current Compliance with MPS Appendix K ......................................12
4. Findings ..................................................................14
5. Conclusions ...............................................................17
6. Recommendations ..........................................................18
7. Recommendations Considered but Rejected ......................................22
Appendix A, Detailed MPS Chronology ................................................. 23
Appendix B, 1981 HUD “Issue Paper on the Minimum Property Standards” ..................... 31
Appendix C, MPS Appendix K of HUD Handbook 4910.1 .................................. 34
Appendix D, Mortgagee Letter 2001-27 ................................................. 43
Appendix E, Form HUD-92541, “Builder’s Certification of Plans, Specifications, and Site” ........ 45
Appendix F, Parts of the U.S. Code Containing the Phrase “Minium Property Standards&rdquo; .......... 48
Appendix G, Sections of the Code of Federal Regulations Containing the Phrase “Minium Property
Standards”.................................................................. 50
Appendix H, Section 801, Builder’s Certification as to Construction ........................... 53
Appendix I, Study Methodology ....................................................... 54
Appendix J, Bibliography/Related HUD Documents ....................................... 55
Appendix L, Acronyms .............................................................. 56

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1. Introduction
This is a study of the one- and two-family dwelling portion of the HUD Minimum Property
Standards (MPS) program, a well known and once venerated building regulatory program
associated with the approval of HUD-insured mortgage loans. The one- and two-family dwelling
portion of the MPS is used for qualifying “high-ratio” loans for new homes (loans for 90 percent
or more of a home’s value), and, nationwide, it applies to about one half of one percent of all
home mortgages. The MPS has its roots in the National Housing Act of 1934, the law that
created HUD’s predecessor, the Federal Housing Administration, and the nation’s first
government-backed mortgage insurance program. An examination of the multifamily housing
portion of the MPS was not included in this study.
Information for the study was gathered by reviewing the statutory, regulatory, and administrative
documents and procedures governing the MPS and by interviewing present and retired MPS staff
from HUD’s Washington, D.C., headquarters, personnel from HUD’s four regional Home
Ownership Centers, and representatives from the home building and building products
industries. The study took approximately eighteen months and was concluded early in 2003.
A related study of the Technical Suitability of Products (TSP) Program was conducted
simultaneously. The TSP program, mandated by the Housing and Urban Development Act of
1965, provides acceptance criteria for nonstandard materials, components, and systems used in
HUD-insured housing and covered by the MPS program.

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A detailed chronology of the history of the MPS is included in Appendix A.
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2. History of the MPS Program
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The 1920s and 1930s
In 1922, twelve years before passage of the landmark National Housing Act of 1934, the
Department of Commerce’s Bureau of Standards issued a new publication called Recommended
Minimum Requirements for Small Dwelling Construction. It was prepared by the Bureau’s
Building Code Committee and was based on extensive hearings held the previous year by the
Senate Committee on Reconstruction and Production. The Committee found that
The building codes of the country have not been developed upon scientific data but rather
on compromise; they are not uniform in practice and in many instances involve an
additional cost to construction without assuring more useful or more durable buildings.
Federal interest in housing regulation continued throughout the 1920s and intensified during the
early years of the Depression. In 1931, civic leaders from across the country attended the
President’s Conference on Home Building and Home Ownership in Washington, D.C. The same
year, the Bureau of Standards reestablished its Building Code Committee (which included the
remaining four of its original seven members) to revise and update the Recommended Minimum
Requirements for Small Dwelling Construction. The second edition, issued in 1932, contained 25
pages of general construction requirements and 77 pages of acceptable practices. Its foreword,
written by then-Secretary of Commerce, R. P. Lamont, thanked the Committee and noted that
The prominent part played by the earlier edition of your committee’s recommended
small-dwelling requirements has already done much to bring about progressive changes.
Your work has thereby helped to reduce costs and assure better quality of construction.
These, your latest recommendations, should greatly assist local code committees in
framing and revising codes and encouraging uniformity in their requirements.
It was at this nascent stage of a national effort to develop sound local housing codes and
standards that the National Housing Act was enacted in 1934. The following year, the newly
established Federal Housing Administration (FHA) published the earliest version of what much
later became the HUD Minimum Property Standards. Titled Circular 2, Property Standards:
Requirements for Mortgage Insurance under Title II of the National Housing Act, the 16-page
publication focused primarily on neighborhood design and planning. Almost four pages were
devoted to providing broad requirements for construction and equipment, such as “All parts of
buildings shall be designed and constructed to safely support their own weight and that portion
of the dead and live loads which they may carry.”

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The stated purpose of Property Standards was two-fold —the reduction of mortgage risks and
the improvement of housing standards and conditions:
This circular is issued for the purposes of guiding the judgement of lenders contemplating
applications for mortgage insurance and of providing to borrowers, architects, and
builders information as to the policy of the Federal Housing Administration in regard to
the character of properties which constitute eligible security for an insured mortgage
loan.
The Federal Housing Administration, as the custodian of funds accumulated from
insurance premiums, must eliminate, so far as possible, the risks to which these funds
may be subjected [emphasis added]. The mortgage insurance facilities of the Federal
Housing Administration may be made available, therefore, only to those properties whose
prospects of continued utility are sufficiently good to give assurance of their enduring as
sound investments throughout the life of the mortgage.
In addition, the National Housing Act definitely places upon the Federal Housing
Administration the obligation to encourage improvement in housing standards and
conditions [emphasis added]. While this obligation permits the Administration to view
property standards from considerations of the security and well-being of the occupants of
dwellings, entirely apart from the factors involved in the safety of the investment itself, it
is the conviction of the Administration that, in long-time investment, the qualities which
produce a satisfactory social condition also tend to assure economic soundness.
In 1936, FHA published a second edition of Property Standards that included five pages of
general requirements for construction and equipment. It concluded by referencing another
publication, Minimum Construction Requirements for New Dwellings, which the FHA state
insuring offices began issuing in early 1937. While Property Standards focused on neighborhood
design and planning, Minimum Construction Requirements addressed construction materials and
techniques. Using an FHA master text as the basis, each state insuring office modified its version
of Minimum Construction Requirements to match local construction practices (the modifications
were mostly minimal) and to inspect each property proposed for FHA mortgage insurance. Since
there was at least one, and often several, FHA insuring offices in each state, many localized
versions of Minimum Construction Requirements were printed. About the same time, the state
insuring offices began producing their own slightly modified versions of Property Standards.
FHA regularly updated the master text of both publications, and the state insuring offices did
likewise, so that each local version of Property Standards and Minimum Construction
Requirements was revised and republished two or three times by 1941, when housing
construction slowed, and then stopped, in most places, because of the war.
The early versions of Minimum Construction Requirements—about 17 pages in length—covered
masonry, structural iron and steel, lumber, framing, roof coverings, sheet metal, lathing, plaster
work, stucco, painting, electrical work, plumbing, and heating. The preface of Minimum
Construction Requirements stated that “The requirements contained herein provide for a
Minimum Standard of Construction for properties offered as security for an insured mortgage”
and that

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The Minimum Construction Requirements shall be applied –
(a) When the requirements contained in the specifications submitted are not specific or
are lower than those contained in the Minimum Construction Requirements.
(b) When the requirements of applicable Building Codes and Regulations are of a lower
standard than those contained in the Minimum Construction Requirements.
(c) Where there are no existing Local Building Codes and Regulations.
This wording is significant because it required conformance to Minimum Construction
Requirements only when a project’s construction specifications or the local building code’s
requirements were of a lower standard. That is, Minimum Construction Requirements was
designed to serve as a default standard for deficiencies in local code enforcement.
The 1940s and Early 1950s
In January 1942, the FHA published a new master text that combined Property Standards and
Minimum Construction Requirements into one document called Minimum Property
Requirements. It was used by at least one FHA insuring office—the Southern California District,
probably because of housing construction for wartime personnel. In May 1942, FHA published
Minimum Requirements for Rental Housing Projects, the precursor to a multifamily edition that
was to appear four years later. In January 1943, the FHA published Amendments to the Minimum
Property Requirements for All New Dwellings, which dealt with wartime material shortages.
In September 1945, the FHA issued Master Draft of Proposed Minimum Property Requirements
for Properties of One or Two Living Units, the first post-war master text. Greatly expanded, it
ran approximately 180 pages in length and contained detailed prescriptive construction
requirements for every part of a dwelling. Within a year, the state insuring offices were
publishing and enforcing their own versions of Minimum Property Requirements for Properties
of One or Two Living Units as well as a new multifamily edition, Minimum Property
Requirements for Properties of Three or More Living Units.
In August 1947, FHA published Significant Variations of the Minimum Property Requirements
of FHA Insuring Offices, apparently in response to post-war interest in industrialized housing.
This examination of variations in construction requirements among state insuring offices appears
to be the beginning of a consolidation process; within a year or two, the insuring offices were
issuing Minium Property Requirements on a multi-state basis. A southern version, for instance,
covered the states of Georgia, Alabama, South Carolina, North Carolina, Mississippi, and
Tennessee. These consolidated editions were revised every few years from the late 1940s
through the mid-1950s by FHA.

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1958 to 1980: Expansion of the MPS
In November 1958, Minimum Property Requirements was renamed Minimum Property
Standards and issued in a single, national edition titled Minimum Property Standards for One
and Two Living Units. The introduction stated that
The purpose of the National Housing Act, as stated in the preamble, is “to encourage
improvement in housing standards and conditions [emphasis added], to provide a system
of mutual mortgage insurance, and for other purposes.”
In pursuance of this purpose, the Federal Housing Administration has established these
Minimum Property Standards. They are intended to obtain those characteristics in a
property which will assure present and continuing utility, durability and desirability as
well as compliance with basic safety and health requirements [emphasis added]. To
provide this assurance, these standards set forth the minimum qualities considered
necessary in the planning, construction and development of the property which is to serve
as security for an insured mortgage [emphasis added].
This new, completely revised edition numbered 315 pages and was the result of several years of
intensive work by the FHA. According to the introduction of the March 1959 Review of
Minimum Property Standards for One and Two Family Living Units, a publication written to
explain the new MPS to home builders:
In 1951 there were 51 separate editions of the MPR’s in use. By 1956 the number had
been reduced to 21. Even that was too many. It was not only hard on builders to have 21
sets of requirements—it was hard on the FHA itself to make consistent interpretations,
keep them all revised and to stock the various quantities needed. As builders increased
the scope of their operations, distances began to shrink. Local customs began to be
absorbed in a more general pattern of construction practices. The multiple MPR’s were
unsatisfactory on this account, and in addition they were out of date in many respects as
well as being deficient or incomplete in others. They needed to be consolidated, clarified,
and updated.... It was decided that the best way to do the job would be to forget the old
MPR’s and make a completely new start.
1. One set of standards would be established for use anywhere in the United States.
2. The title would be “Minimum Property Standards,” since standards of performance
were the aim and purpose.
3. The standards would define the minimum level of quality acceptable to FHA and to
VA, keeping in mind the dual objective of reaching the needs of purchasers in low
income brackets and at the same time assuring the purchaser full value for his dollar.
4. The standards would be designed for use by both small and large builders. They would
cover everything necessary, and they would be spelled out so clearly that there would be
the least possible need for interpretation and the least possible chance of
misinterpretation.
5. In arrangement as well as content, the book would be planned for the convenience of
those who would use it most—builders, architects, and engineers.
6. Generally accepted standards developed by nationally recognized authorities would be
relied on for determining whether materials were suitable, how they should be tested and
assembled, and how they should be expected to hold up when in use.
7. Illustrations should be used whenever they would help to explain a standard.

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The amendments are minor and are described in Appendix F under the 12 USC 1735f-4 heading.
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8. Requirements that would apply only in certain localities would be omitted.
The new MPS was created by an FHA task force that “examined the 21 sets of minimum
property requirements and consulted with the FHA state field offices” as well as with “materials
manufacturers, architects, engineers, and over 150 trade associations.” Concurrently,
representatives from the National Association of Home Builders collected comments from local
builder groups across the country. The introduction to the 1959 Review continued:
Altogether, 4 drafts of the standards were prepared. The final result is a set of standards
for which the industry itself is largely responsible. It represents an outstanding
cooperative effort by industry and Government.
With this new, renamed, and greatly expanded version of the pre-war Minimum Property
Requirements—originally intended by FHA as a set of minimal default requirements where local
codes were poor or unenforced— the 1958 edition of the MPS became a de facto building code,
a largely prescriptive document that went well beyond local codes in specifying allowable
building methods, materials, components, and finishes, as well as minimum dimensions, room
sizes, and the like.
In 1965, Congress created the Department of Housing and Urban Development. Within several
years, FHA’s long tradition as an independent agency with a separate staff and autonomous
budget authority ended. But Minimum Property Standards continued to expand. In 1973, HUD
published it in four volumes:
Volume 1, Minimum Property Standards for One and Two Family Housing
Volume 2, Minimum Property Standards for Multifamily Housing
Volume 3, Minimum Property Standards for Care-Type Housing
Volume 4, Manual of Acceptable Practices to the HUD Minimum Property Standards
Each volume contained the following Foreword, which reiterated the objective of improving
housing standards and conditions, this time with a unified set of standards:
A Congressionally directed objective of the Department of Housing and Urban
Development is to encourage improvement in housing and residential land development
standards and conditions. The publication of these revised Minimum Property Standards
provides the Department for the first time with a single unified set of technical and
environmental standards. They define the minimum level of acceptability of design and
construction standards for low-rent public housing as well as housing approved for
mortgage insurance [emphasis added].
Volume 4, the new Manual of Acceptable Practices, ran several hundred pages in length, the
result of a major effort by HUD “to help builders more readily meet the requirements of the
MPS.”
In 1978, Public Law 95-619 (subsequently amended in 1980, 1983, and 1984)
2
added stricter

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The other legislation, passed in 1983, is described below. A handful of related amendments apply to
multifamily and care-type housing; see Appendix F.
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energy performance requirements to the MPS:
12 USC Section 1735f-4 (a). To the maximum extent feasible, the Secretary of Housing
and Urban Development shall promote the use of energy saving techniques through
minimum property standards established by him for newly constructed residential
housing, other than manufactured homes, subject to mortgages insured under this chapter.
Such standards shall establish energy performance requirements that will achieve a
significant increase in the energy efficiency of new construction. Such requirements shall
be implemented as soon as practicable after November 9, 1978. Following November 30,
1983, the energy performance requirements developed and established by the Secretary
under this subsection for newly constructed residential housing, other than manufactured
homes, shall be at least as effective in performance as the energy performance
requirements incorporated in the minimum property standards that were in effect under
this subsection on September 30, 1982.
In the history of the MPS for one- and two-family dwellings and its predecessors stretching back
to 1934, this is one of only two pieces of legislation directly affecting the MPS’s content.
3
The
balance of the MPS has been created solely under the regulatory authority of HUD and its
predecessor, the FHA—guided by the intent stated in the preamble of the 1934 National Housing
Act, “to encourage improvement in housing standards and conditions, to provide a system of
mutual mortgage insurance, and for other purposes,” and by the wording of similar statements in
later housing acts.
In 1979, HUD issued an updated Minimum Property Standards, One and Two Family Dwellings.
At 196 pages, it was considerably reduced in size from the 1958 edition (a reduction no doubt
enabled by existence of the Manual of Acceptable Practices). Its Preface declared:
These Minimum Property Standards are intended to provide a sound technical basis for
the construction of housing under the numerous programs of the Department of Housing
and Urban Development. The standards describe those characteristics in a property which
will provide present and continuing utility, durability, economy of maintenance, and a
safe and healthful environment [emphasis added].
1980 to the Present: Declining Role of the MPS
In August 1980, the National Association of Home Builders Research Foundation sent a report
to HUD titled Recommendations for Solutions to Permit Compatible Use of the One and Two
Family Code and the Minimum Property Standards. By way of background, the report praised
the MPS program but said its role in homebuilding was decreasing:
The MPS originated as a set of mortgage insurance criteria to assure the health, safety,
durability, and marketability of homes financed under FHA programs. In the past, much
of the housing in the U.S. was produced under these programs. In the post World War II
period up to the early 1960s a majority of middle priced housing was sold with FHA-

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The CABO One and Two Family Dwelling Code, a distillation of model building code requirements
applying specifically to housing, was first published in 1971 as a joint effort of four model code groups—BOCA,
ICBO, SBCCI, and the American Insurance Association. It was well received by home builders and code officials
and adopted in many areas of the country by 1980.
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insured mortgages. The added security afforded to the lenders made long term, low down
payment mortgages available to millions of Americans who could not otherwise have
afforded a home. The program was self supporting through a small surcharge in the
mortgage payment.
During this period, the Minimum Property Requirements (MPR), later called the
Minimum Property Standards (MPS), played a major role in assuring the construction of
sound, marketable housing. It also had a tremendous influence on establishing and
standardizing sound building practices beyond FHA jurisdiction.
At the time, the MPR represented the first complete set of practical building standards in
the U.S. It was essentially a textbook for home building with detailed instructions and
illustrations for all phases of construction, written in simple language and logical format
for the home building industry. Many builders were influenced to alter their practices,
resulting in better homes at less cost. Lenders were better able to judge the soundness and
value of homes for mortgage applications. Building code groups modified their
requirements to resemble the superior technical provisions of the MPS. Manufacturers
were able to standardize products and market them nationally, and FHA approval of a
product became paramount to market acceptance.”
In fact, the earlier FHA program was so successful that the private financial sector
became convinced that they could assume the same risks on a profitable basis. At the
same time, building codes were becoming more responsive, and most communities who
previously had an inadequate code or no code at all were adopting an updated building
code based on a national model code [emphasis added]. Meanwhile, building methods,
materials, and products had become increasingly standardized across the U.S. In short,
there was a new climate portending a long term decline in FHA activity in home building,
and a steadily decreasing role for the MPS.
The report then summarized the findings of a 1978 HUD Task Force on Housing Costs, which
found the requirements of the MPS excessive and inflexible and recommended that HUD
“immediately remove unjustifiable cost-increasing technical and design requirements.”
The report noted that HUD had raised many MPS requirements to the point that they impeded
the production of affordable housing, and that HUD should adopt the CABO One and Two
Family Dwelling Code in its place.
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It was generally concluded that the [CABO]1-2 Family Dwelling Code offers a viable
and logical alternative to MPS health/safety requirements in its present form and should
be accepted as such by HUD as soon as possible.
The remaining portion of the MPS dealing with other requirements related to mortgage
insurance, various Federally mandated items, or other HUD operations should also come
under scrutiny..… Regulations pertaining to such areas as appearance, livability and
marketability represent arbitrary value judgments. The Minimum Property Standards no

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Federal Regulations Impacting Housing and Land Development: Recommendations for Change, page 5.
National Institute of Building Sciences, Washington, D.C. April 15, 1981.
6
The full text of this paper is printed in Appendix B.
9
longer represent minimum standards for adequate housing. Such arbitrary provisions
have tended to escalate in recent years, partly through a narrow interpretation of HUD’s
mandate to improve the “quality of housing.” A broader interpretation of this mandate,
however, would hold that the overall quality of housing can be improved by making
affordable housing available to an increasing proportion of the populace who cannot now
afford a home. Many of these people are less concerned with the level of quality, features
and amenities than with the availability of a clean, safe and sound home that they can
afford. The effect of unnecessary quality-related requirements is to deny an adequate
home to many of these people. The alternative is substandard housing.
In 1981, the National Institute of Building Sciences’ Task Force on Federal Regulations
Impacting Housing and Land Development made a similar recommendation:
HUD should initiate a comprehensive and rational process to phase out the MPS for
HUD-insured housing and rely on the nationally recognized model codes, and on State
and/or local authorities that have adopted such codes or that have their equivalent, to
regulate the health and safety aspects of such housing, and on free market forces to
establish acceptable performance levels for livability and marketability of such housing.
5
The same year, HUD staff prepared an “Issue Paper on the Minimum Property Standards” that
summarized the background of the MPS and presented three options for action, with pros and
cons for each: (1) do nothing; (2) make the MPS identical to the CABO One and Two Family
Code; and (3) phase out the MPS and depend entirely on the local codes and the marketplace. No
recommendations were presented, but the paper concluded by saying that downsizing the MPS
appeared to be underway:
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Modest revisions to the single family MPS were published for proposed rule making in
the Federal Register in September 1980. Extensive revisions to the proposed rule are now
in process in response to the comments received following that initial publication.
Proposed changes resulting from those comments would delete large portions of the MPS
in favor of letting the local market conditions prevail where possible. Other changes
would remove these portions duplicated by the [CABO] One and Two Family Dwelling
Code. The final rule will be published pending a decision on the need for an
environmental impact statement. The discussions in this paper reflect the changes now
being proposed for the single-family MPS.
In 1982, HUD again issued an updated Minimum Property Standards, One and Two Family
Dwellings. Its introduction is identical to that of the 1979 edition but its foreword states that the
one- and two-family MPS will be phased out “because they have largely accomplished their
purpose” and that “home buyers’ interests can be protected with less federal intervention”:
This revision of the Minimum Property Standards for One- and Two-Family Dwellings
will be the last revision. The content of this revision is reduced in substance and in bulk.
It reflects the policy of the Department to move away from imposing Federal standards

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where market forces, local requirements and nationally recognized standards developed
in the private sector serve to achieve the same goals [emphasis added].
Thus, many of the ‘livability and marketability’ provisions have been eliminated
[emphasis added], provisions from the One and Two Family Dwelling Code developed
by the Council of American Building Officials replace analogous MPS requirements, and
quotations from readily available standards are referenced rather than repeated.
This revision is a step toward phasing out the Minimum Property Standards for One- and
Two-Family Dwellings because they have largely accomplished their purpose [emphasis
added]. The Department is indebted to the many groups whose recommendations support
our conclusion that both the Department’s and the home buyers’ interest can be protected
with less federal intervention.
In 1983, Congress passed Public Law 98-181, title IV, Sec. 405, permitting HUD to allow
compliance with model or local building codes as a means of satisfying mortgage insurance
requirements, thereby virtually eliminating the need for the one- and two-family MPS except for
specifying allowable codes and determining code comparability:
12 USC Section 1735f-4 (b). The Secretary may require that each property, other than a
manufactured home, subject to a mortgage insured under this chapter shall, with respect
to health and safety, comply with one of the nationally recognized model building codes,
or with a State or local building code based on one of the nationally recognized model
building codes or their equivalent. The Secretary shall be responsible for determining
the comparability of the State and local codes to such model codes and for selecting for
compliance purposes an appropriate nationally recognized model building code where no
such model code has been duly adopted or where the Secretary determines the adopted
code is not comparable [emphasis added].
This is the second of the two pieces of federal legislation that directly affect the content of the
MPS. Note that it does not confine itself to one- and two-family dwellings.
In 1984, HUD issued Minimum Property Standards for Housing. The previous Minimum
Property Standards, One- and Two-Family Dwellings and the Minimum Property Standards,
Multifamily Housing were now combined into one document, with the one- and two-family
portion renamed “Rules for One and Two Family Dwellings” and relegated to a 31-page
Appendix K. The hundreds of MPS livability and durability provisions, previously applicable to
one- and two-family dwellings as well as to multifamily housing, now applied only to
multifamily housing.
About two-thirds of the new Appendix K focused on HUD state field office requirements for
specifying allowable codes and determining local code acceptability. The balance contained
several pages of requirements for site design and planning, energy conservation, and private
water supply systems and wells, as well as a small number of modifications to model code
structural requirements. These remaining contents were strikingly similar in size and intent to
those of the 16-page Property Standards of 1935.
In 1994, HUD issued the current edition of Minimum Property Standards for Housing, renaming
Appendix K “Minimum Property Standards for Property which Is Not Multifamily or Care-Type

11
Property.” The appendix is identical to its 1984 counterpart except that the reference standards
are updated, the term “physically handicapped” is changed to “disabilities,” FEMA requirements
under the National Flood Hazard Program are added, and a reference to the CABO Model Energy
Code replaces the energy conservation section.
The foreword and introduction to the 1994 MPS declare:
These Minimum Property Standards reference nationally recognized model building
codes for concerns relating to health and safety. Locally adopted building codes can be
used for the same purpose when they are found acceptable by the HUD field office
[emphasis added].
The full text of MPS Appendix K is provided in Appendix C.
In May 2001, the International Code Council, under subcontract to the National Evaluation
Service, submitted a report to HUD titled Proposed 2001 Edition of the Minimum Property
Standards for Housing. The proposed changes to MPS Appendix K are confined almost entirely
to updating referenced codes and standards to, in almost all cases, the 2000 edition of the
International Residential Code, the successor to the CABO One and Two Family Dwelling Code.

7
The MPS, including Appendix K, is published in HUD Handbook 4910.1, Minimum Property Standards
for Housing. HUD added Appendix K to the Code of Federal Regulations, and CFR section numbers are used within
the Appendix, which is generally referred to as 24 CFR 200.926.
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3. Current Compliance with MPS Appendix K
Appendix K of the MPS, where the one- and two- family dwelling requirements were consigned
in 1984, sets forth detailed instructions to the HUD state field offices for determining the
acceptability of state and local building codes in Sections 200.926, 200.926a, 200.926b and
200.926c, and it adds a small number of supplemental structural design requirements in Section
200.926e.
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Specifically, subsection 200.926a(4) instructs the HUD field offices to:
....maintain a current list of jurisdictions with accepted local or State building codes,
[and] a current list of jurisdictions with partially accepted local or State building codes
which have not been accepted. For local codes, the lists will state the most recent date
when the code or changes thereto were submitted to the Secretary.... In addition, the list
of jurisdictions whose codes have been partially accepted shall be identified in
accordance with Section 200.926c [or] those portions of the codes listed at Section
200.926b(a) with which the property must comply.
This requires HUD to keep track of the building codes used in thousands of jurisdictions across
the United States and to certify their acceptability. Such a large, continuing task could not be
adequately carried out even prior to 1994, when the HUD state field offices had design and
construction staffs, and it is not being performed at all now by the four regional Home
Ownership Centers (HOCs). To quote the four HOCs:
The [code certification process] applied only in the context of our old organizational
structure. Our previous structure of 81 field offices has been reduced to only four. We
have no resources or staff to do it. Our office relies on and defers to the builder’s
certification of code compliance. (Philadelphia)
We do not specify a code for compliance. We rely on the local jurisdiction for code
compliance, inspection, and enforcement (Atlanta)
Our construction analysts—there are two for the entire region—have a somewhat
superficial knowledge of the MPS and other codes.... We make no recommendations
regarding code requirements or compliance. (Santa Ana)
Our philosophy is to allow use of the local building codes.....We have taken the position
that the local jurisdiction is ultimately responsible for code compliance and we will
accept whatever they decide is proper. (Denver)
In the mortgage insurance application process, HUD addresses code compliance in Form
HUD-92541, “Builder's Certification of Plans, Specifications, and Site,” which includes a blank
for writing in the name of the building code used by the builder, and three check-off boxes for
certifying the builder’s adherence to the CABO One and Two Family Dwelling Code, the CABO

8
HUD Handbook 4145.1 is being revised, but the HUD staffer in charge said that its content has changed
little and that the project is “on hold.”
9
Most field inspections ceased after the HUD field office design and construction staffs were disbanded in
1994, and they are virtually impossible for the HOCs to make now, except as random checks, because of the HOCs’
vast geographic coverage.
10
Except in some rural areas of the country where there are no building codes (and usually little
construction).
13
1992 Model Energy Code, and the 1984 NFPA Electrical Code for One- and Two-Family
Dwellings. Form HUD-92541 also lists many of the same requirements set forth in Section
200.925d of MPS Appendix K. (Form HUD-92541 is shown in Appendix E.)
To be eligible for a high-ratio loan, a builder also must certify compliance with Section 200.926d
and HUD Handbook 4145.1, Architectural Processing and Inspections for Home Mortgage
Insurance. Most of the requirements of Section 200.926d do not apply to houses built in areas
with adequate subdivision regulations and public water supply systems—that is, they do not
apply to the vast majority of new houses (an exception is 200.926d’s energy requirements, which
universally apply). Handbook 4145.1, last issued in 1991, is a process document containing
requirements for home builders (for the submission of architectural exhibits); for HUD field
offices (processing procedures); for fee inspectors (inspection procedures); and for home
warranty providers (including an 12-year-old list of “HUD-accepted Insured Ten-Year
Protection Plans”). Most of this material is outdated and many procedures are not followed.
8
Regardless, according to the HOCs, Form HUD-92541 is not reviewed by anyone at HUD
beyond ensuring that it has been completed, signed, and included in the mortgage file. Few, if
any, applications for HUD mortgage insurance are said to be denied on the basis of
non-compliance with MPS Appendix K (which stands to reason since the HOCs have no
consistent way of verifying that the information in Form HUD-92541 is correct
9
).
Recognizing this dilemma, HUD issued Mortgagee Letter 2001-27 in October 2001, which
permitted the issuance of a local building permit as evidence of HUD pre-approval and the
issuance of a certificate of occupancy as evidence of code compliance for a HUD-insured
high-ratio loan. (Mortgagee Letter 2001-27 is shown in Appendix D.)

Allowing the building permit, which the builder must obtain anyway, to be used as pre-approval
for HUD insurance not only circumvents the weaknesses of Form HUD-92541, it provides a
substantial benefit to potential homeowners because it means the builder does not have to decide
before the home is built if it needs to be HUD-eligible. Since October 2001, homes with building
permits and certificates of occupancy—virtually all homes built—are eligible.
10

11
Along with Early Start Letters and HUD-approved 10-year warranty plans, and the regulations that
accompany them. The background and details are provided in Mortgagee Letter 2001-27, reproduced in Appendix D.
14
4. Findings
1. Mortgagee Letter 2001-27 has, in effect, rendered MPS Appendix K and HUD Handbook
4145.1 irrelevant.
11
It is now the building permit and certificate of occupancy that determine
eligibility for a HUD-insured high-ratio loan. This change virtually completes the 20-year
transition of the MPS for one- and two-family dwellings from requiring conformance to a unique
body of largely prescriptive construction requirements to deferring to the requirements of local
building codes, thereby allowing HUD-insured properties to be regulated in the same manner as
millions of other housing units nationwide, regulations that by conventional standards provide
sound, safe, healthy, and livable housing.
All that remains is to remove the layers of accumulated regulatory remnants that have made the
one- and two-family construction requirements of the HUD mortgage insurance process
unnecessarily misleading, contradictory, confusing—and honored largely in the breech.
2. The segment of the housing market affected by the MPS is tiny. The MPS for one- and two-
family dwellings applies only to high-ratio loans for new homes (loans for 90 percent or more of
a home’s value). Of the 1.3 million mortgages HUD insured in 2001, only 47,000 were for new
homes, and not all of them involved high-ratio loans. This amounts to less than 3.6 percent of
total HUD mortgage loans, and, because HUD only insures about 15 percent of the home
mortgage market, it amounts to only about 0.5 percent of all home mortgages. While this does
not affect the regulatory role of the MPS, it puts it in perspective.
3. The MPS for one- and two-family dwellings does not increase housing durability. A common
justification for the MPS is that it promotes increased durability. This is arguably true for the
multifamily portion of the MPS, which still contains hundreds of livability and durability criteria
(such as minimum dimensions and room sizes and allowable building methods, materials,
components, and finishes) that go well beyond building code requirements, but it is not true for
MPS Appendix K. As noted, when the one- and two-family dwelling requirements were moved
to Appendix K in 1984, the livability and durability requirements did not go with them. Section
200.926e of Appendix K modifies several structural requirements of the CABO One and Two
Family Code, but otherwise only the requirements of the model codes apply.
The Technical Suitability of Products (TSP) Program (referenced in Section 200.926d(d) of MPS
Appendix K) is said to be another factor in increasing durability, and all of the TSP Program’s
Materials Releases and a few of the Structural Engineering Bulletins do in fact require product
warranties. But these warranties are typically the same as those carried by the products anyway.
Furthermore, Mortgagee Letter 2001-27 formally ended the need for third-party inspections of
new homes, so there is no way to check whether or not products with TSP acceptances are used
in homes seeking HUD mortgage insurance. In fact, few site inspections have been made since
the HUD state field offices lost their design and construction personnel in 1994.
4. Few HUD mortgage defaults are tied to housing defects. According to interviews with the

12
The FHA Mortgagee Starter Kit on the HUD website lists 14 HUD handbooks and several hundred
mortgagee letters “that you will want in your library to support your single family business.”
15
HOCs and other present and retired HUD personnel, it is rare that a home owner defaults
because of housing defects, although no hard data exist. No one has suggested that housing
defects caused by lack of code conformance have a measurable effect on mortgage default rates.
This may be because builders are accustomed to building to current code requirements, even
where codes are not enforced, or it may be that the marketplace is driving equivalent
performance, or it may be that the problem exists but is too small to be recognized. At any rate,
the average number of HUD-insured new homes built in areas lacking code enforcement is
probably so low (perhaps a few hundred per year, perhaps less?) that the number of
defect-related defaults (three, one, zero?) over a period of several years may be too few to justify
the costs of additional enforcement.
5. The MPS is confusing to homebuilders. Homebuilders seem to view conformance with the
locally adopted code as necessary for MPS compliance, but they are uncertain if the MPS might
require something more or different. After all, they must sign Form HUD-92541, certifying
compliance with parts of Section 200.926 of the Code of Federal Regulations and with HUD
Handbook 4145.1. In the unlikely event they obtain these documents, they must then decipher
them and decide what applies to one- and two-family dwellings (in most instances, little or
nothing does). Then there are the 716 HUD mortgagee letters and numerous HUD handbooks,
guidebooks, and notices.
12
All of this introduces needless confusion, ambiguity, and discomfort
in homebuilders regarding HUD mortgage requirements.
6. The MPS also confuses and misleads Congress, consumers, product manufacturers, and policy
makers—and even HUD staff. The 67-year-old MPS has confused more than home builders. No
clean break was made in 1984 either with the name, Minimum Property Standards, or with the
huge accompanying MPS regulatory infrastructure of handbooks, guidebooks, notices, and
mortgagee letters—an infrastructure that remained fully in place for multifamily housing but
only partially and confusingly so for one- and two-family dwellings. Congress still thinks of the
MPS as an active program to which it can append new requirements. Consumers, and nearly
everyone else, believe that the MPS provides better quality and more durable housing. Product
manufacturers confuse it with the TSP Program. Policy makers remember the MPS as a time-
tested means of improving the nation’s housing stock. At HUD, there appears to be no one left
who knows all the parts of the MPS program and few who understand its current condition.
7. FmHA and VA no longer rely on the MPS. At one time, both the Farmers Home and Veterans
Administrations used the MPS as a model for their own housing insurance programs; citations in
some MPS documents still refer to this. But FmHA lists the MPS only as a reference in its “RD
Instruction 1924-A,” and the VA's Minimum Property Requirements, modeled after an older
version of the MPS, no longer references the MPS at all.

13
Interview with Charles Gueli of Merrill-Lynch.
14
Some of the documents listed here, such as Directive 1100.3 listing regional and field offices, and
Handbook 4940.2, Minimum Design Standards for Community Water Systems, are long out of date or no longer
issued.
16
8. Conventional mortgage lenders rely on local codes, not the MPS. According to Merrill-Lynch,
which covered about $8 billion in single family mortgage underwriting in 2000, “We do not use,
and as far as we know, no lender uses, the MPS. Over the years, model codes have substantially
replaced the need for HUD-based standards. We rely entirely on local enforcement of local codes
in our lending process.”
13
9. References to the MPS abound in HUD publications and documents. The long life of the MPS
has left a trail of statutory, regulatory, and administrative references to “minimum property
standards,” “‘minimum standards,” “property standards,” “minimum property requirements,”
and “minimum requirements,” the last two terms reminders of the period from 1942 to 1958
when the Minimum Property Requirements governed.
– Statutory references. The 16 statutory references to the phrase ‘minimum property
standards’ are generic and written in lower case. Only two references (regarding energy
conservation and the use of state and local codes, as described earlier) have affected the
actual content of the MPS. The remaining 14 references have no specific application to
one- and two-family dwellings or are explicitly directed to multifamily, care-type, or
manufactured housing. Appendix F contains the text of those parts of the U.S. Code using
the term ‘minimum property standards.’
– Regulatory and administrative references. The regulatory and administrative references
to “minimum property standards” (in upper and lower case) and to “MPS,” however, are
numerous. A search of HUD documents on www.hudclips.org
14
for the phrase “minimum
property standards” finds it used 22 times in the Code of Federal Regulations, five times
in HUD guidebooks, 189 times in HUD handbooks and notices, and nine times in HUD
mortgagee letters. References to “MPS” are even more numerous; Handbook 4950.1 on
the TSP Program, for instance, uses the initials ‘MPS’ 35 times. Appendix G contains the
text of the 22 citations in the CFR using the term “minimum property standards.”
10) There is no constituency for the MPS. The homebuilders, through their national association,
NAHB, have pushed for the elimination of the MPS for more than twenty years, and no
consumer groups are on record as supporting the program. Most product manufacturers (as
described in the accompanying TSP study) see the MPS and its related TSP Program as
irrelevant or redundant. Resources at HUD have been reduced for both programs and
experienced MPS staff have not been replaced.

17
5. Conclusions
The one- and two-family portion of the MPS is burdened by 68 years of outdated associations
and expectations and a large body of outmoded regulations and procedures. HUD headquarters
and field personnel have kept the one- and two- family program functioning over the past two
decades largely by working around increasingly antiquated regulatory requirements.
These problems may be readily resolved by realigning HUD regulations and administrative
documents with present HUD practices. There is no explicit provision in federal law mandating
the MPS, so the following changes can be made administratively:
• Eliminate the one- and two-family portion of the MPS (Appendix K).
• Formalize the one- and two-family mortgage approval process now in use. The process
works well in everyday practice and its requirements are similar to those used by the rest
of the mortgage industry.
• Completely separate the new one- and two-family program from the remaining
multifamily MPS program and give it a separate identity, thereby drawing a clear line
between the two.
• Remove all one- and two-family references from the MPS program and its related
administrative documents and procedures; revise these documents and procedures as
appropriate; and eliminate or revise outmoded MPS regulations.
These actions will rationalize and clarify the one- and two-family mortgage approval process,
provide greater certainty to homebuilders and more transparency to consumers, and help manage
expectations among members of Congress, policy makers, and product manufacturers about the
uses and capabilities of HUD’s one- and two-family mortgage insurance program.
Specific recommendations for accomplishing these tasks follow.

18
6. Recommendations
1. Delete the MPS for one- and two-family dwellings (MPS Appendix K) and delete its
regulatory counterpart, 24 CFR 200.926, et al, from the Code of Federal Regulations. MPS
Appendix K was codified in 1984 because it delegated authority to specific private sector codes
and standards. Mortgagee Letter 2001-27 eliminated the need for such delegation. The
multifamily portion of the MPS has never been codified and nothing in the MPS was codified
prior to 1984.
2. Delete all programmatic documents related to the MPS for one- and two-family dwellings, as
well as references to the MPS for one- and two-family dwellings in all other HUD regulations,
handbooks, guidebooks, notices, mortgagee letters, forms, web sites, and consumer publications.
This will be a time consuming task because so many documents and references apply jointly to
the MPS for multifamily housing and to MPS Appendix K for one- and two-family dwellings.
Some may be impossible to separate without major rewriting. See Appendix J for a list of
affected documents. An alternative is to eliminate the multifamily MPS as well and avoid this
task altogether.
3. Create a new program for one- and two-family dwellings and give it a new name that has no
association to the MPS.
4. Retain the requirement that new homes need a building permit and certificate of occupancy to
qualify for HUD high-ratio mortgage insurance. This formalizes what HUD Mortgagee Letter
2001-27 of October 2001 has already accomplished.
5. Examine the site analysis requirements listed in the Builder’s Certification, Form HUD-
92541. This form (shown in Appendix E) was last updated in April 2001, and its site analysis
requirements—evolved from but no longer identical to those in Appendix K of the MPS—are the
only non-code requirements for one- and two-family dwellings that HUD still includes in the
mortgage insurance application process. These requirements address potential flood hazards,
noise, aircraft landing zones, explosive materials storage, toxic waste hazards, and hazardous and
adverse conditions. As mentioned above, they are similar in intent and number to the
requirements in FHA’s Property Standards of 1935, indicating that they are important for
meeting the National Housing Act’s goal of reducing mortgage risks and improving housing
conditions. The site analysis requirements may be similar, however, to those of current building
codes and the National Flood Insurance Program, so HUD should compare the various
requirements to determine what should be included in Form HUD-92541.
6. Require certification of code compliance by an independent third-party inspector in non-code
areas. For rural areas without building code enforcement, HUD should require, in lieu of a local
building permit and certificate of occupancy, a written certification by a licensed architect or
engineer of that state that the property is located in a non-code area and that the requirements of
the International Residential Code or the prevailing state building or residential code have been
met.

15
The full text of Section 801 is included in Appendix H.
19
7. Prepare a new Builder’s Certification form. The current Builder’s Certification, Form HUD-
92541, should be modified to reflect the above recommendations, as follows (a copy of Form
HUD-92541 is shown in Appendix E):
– If the site analysis requirements on page 1 are retained, the reference to CFR
200.926d(c)(4) under “Flood Hazards” and the references to HUD Handbook 4145.1 and
FHA Data Sheet 79g under “Foreseeable Hazards or Adverse Conditions” should be
changed or eliminated.
– Boxes 2 through 7 should be eliminated.
– Two statements should be added, one of which the builder must check: (a), a statement
that the property has a building permit and a certificate of occupancy and that both are
attached; and (b), a statement that the property was built in an area without code
enforcement but that it conforms to the requirements of the International Residential
Code or the prevailing state building or residential code, and that a written certification to
this effect, prepared by a licensed architect or engineer of that state, is attached.
– The remainder of the form can be kept as-is, except that the builder’s certification
statement on page 2 should use substitute text for the references to 24 CFR 200.926d, and
page 3 should be revised to reflect the changes made to the site analysis section on page
1, eliminating all references to MPS documents.
8. Examine 12 USC 1735f-4 to determine if it should be amended. HUD’s General Counsel
should examine the legislation directly affecting MPS Appendix K that is incorporated in 12
USC 1735f-4(a) on energy conservation and 12 USC 1735-4(b) on state and local codes:
– Part 12 USC 1735f-4(a) specifies that energy performance requirements for HUD-
insured housing must be at least as effective as those in effect on September 30, 1982.
Section 109 of the Energy Policy Act of 1992 requires new HUD-insured homes to meet
the energy efficiency standards of the 1992 CABO Model Energy Code, which exceed the
energy standards in effect in 1982, so USC 1735f-4(a) does not require amending.
– Part 12 USC 1735f-4(b) gives HUD discretion about what building codes it can
specify, does not require amending.
9. Review the requirements of Section 801. Section 801 of the National Housing Act (12 USC
1701j-1), “Builders Certification as to Construction,” requires that the seller or builder provide
the homeowner with a warranty that the home is constructed according to the plans and
specifications upon which HUD based its valuation.
15
HUD no longer reviews the plans and
specifications for one- and two-family housing. If it does not review them for multifamily
housing, HUD should seek repeal of Section 801. Otherwise, Section 801 should be amended to
exclude one- and two-family dwellings.

16
An examination of the multifamily portion of the MPS was not included as a part of this study; it may use
a mechanism similar to Form HUD-92541.
20
10. Accept local codes as meeting the requirements of Executive Order 12699 and Section 947
of the National Affordable Housing Act of 1990 on seismic safety. Executive Order 12699 and
Section 947 require HUD to develop and enforce seismic safety standards for the programs it
administers. This includes its mortgage insurance programs. HUD is permitted by the Executive
Order and Section 947 to defer to local building codes that meet its seismic standards. Because
the CABO One and Two Family Dwelling Code and its successor, the International Residential
Code, are widely adopted nationwide and already include seismic standards that meet or exceed
HUD standards, HUD should continue to follow Mortgagee Letter 2001-27, which defers to
local codes for seismic safety compliance.
11. Accept local codes as meeting the requirements of Section 109 of the Energy Policy Act of
1992. Section 109 requires new HUD-insured homes to meet the energy efficiency standards of
the 1992 CABO Model Energy Code. Because the 1992 CABO Model Energy Code and its
successor, the International Residential Code, are widely adopted nationwide, HUD should
continue to follow Mortgagee Letter 2001-27, which defers to local codes for energy efficiency
compliance.
12. Review with HUD’s General Counsel the need for references to private sector codes and
standards to be published in the CFR. Code and standard references published in the CFR are
subject to lengthy rule-making processes and quickly become frozen in time—outdated
impediments to a constantly evolving regulatory system. A way must be found to avoid this fate
for the new one- and two-family dwelling program. One alternative is to reference no private
sector codes or standards by name.
13. Amend the multifamily portion of the MPS to include appropriate code references. The MPS
for multifamily housing requires conformance to the codes referenced in MPS Appendix K. If
Appendix K is eliminated, the multifamily MPS will have to be amended to accept local building
codes, similar to what has been done with the MPS for one- and two-family dwellings by Form
HUD-92541.
16
Of course, eliminating the multifamily MPS would solve this problem, too.
14. Consult with affected interests. HUD should consult with the following interests and explain
why it needs to take the above actions: appropriate Congressional committee staff, the housing
staff of the VA and the Farmers Home Loan Administration, the International Code Council, the
Building Owners and Managers Association (BOMA), the National Fire Protection Association
(NFPA), the National Multi Housing Council, and National Association of Home Builders
(NAHB).
15. Develop, launch, and widely publicize a distinctive, easy-to-understand HUD single family
mortgage insurance requirements package for homebuilders, lenders, and buyers. The revised
HUD construction-related mortgage requirements (which would be identical to those printed on
the new Builder’s Certification form recommended above), should be stated clearly and
succinctly on an attractive, single-page brochure or poster for use by builders, lenders, and home
buyers; on appropriate HUD mortgage application forms; and on a well-designed and easy-to-

17
From the Foreword of the 1979 edition of Minimum Property Standards.
18
Email from Rosemarie Geier Grant to William Brenner of December 30, 2002. The email also suggests,
as have others, that ISO’s Building Code Effectiveness Grading Scale may provide useful information on local code
adoption and enforcement (and hence serve as something against which to compare mortgage defaults). An
examination of the ISO material (at www.iso.com/products/2400/prod2409.html), however, reveals that the
information it provides has limited usefulness for housing.
19
The Partnership for Advanced Technology in Housing, or PATH, is a private/public effort to improve
the quality, durability, environmental efficiency, and affordability of the nation’s housing.
21
locate page of the HUD website. As discussed, the program should be given a new and separate
name, and no references should be made to “minimum property standards,” “MPS,” or any
related designations. If the multifamily MPS is retained, it might be wise to explain in its
documentation the separation between it and the new one- and two-family program.
16. Maintain a focus on housing durability through HUD research programs. As noted, HUD
eliminated hundreds of livability and durability provisions for one- and two-family dwellings in
the 1984 edition of Minimum Property Standards. It did so “[to reflect] the policy of the
Department to move away from imposing Federal standards where market forces, local
governments and nationally recognized standards developed in the private sector serve to
achieve the same goals.”
17
In the intervening 17 years, there has been no indication that HUD-
insured housing has experienced an increase in durability-related problems or that there has been
a consequent increase in HUD-insured mortgage defaults, even after 1994, when the HUD state
field offices lost their design and construction personnel and virtually ceased making site
inspections.
Nonetheless, housing durability is a concern. As the staff director for research at State Farm
Insurance Companies, Rosemarie Geier Grant, notes,
18
“Periodically, State Farm hears from
frustrated consumers who have terrible problems with their new homes—problems that are
serious and which, since they are durability/maintenance problems, are not covered by their
homeowners insurance policy, nor by the typical one-year warranty provided by their builder.”
While acknowledging that the market share of HUD-insured homes is small (about one half of
one percent of all new home mortgages), Ms. Grant continues, “regardless of who has written the
mortgage, there is not a zero trend in people walking away from a mortgage due to construction
or material defects.”
There is no ready answer to this dilemma, and good data on housing durability do not exist.
Increased regulation may reduce housing defects, but the aggregate costs to housing consumers
of doing so may be significantly higher than the aggregate costs of the defects. This was believed
to be the case when HUD eliminated the durability and livability requirements from the MPS in
1984. The better course of action is for HUD, through its PATH and other technology-based
research programs,
19
to continue working with the housing industry to make increased durability
a long-term national goal, a goal similar to that of the 1934 National Housing Act’s, “to reduce
mortgage risks and improve housing standards and conditions.”

22
7. Recommendations Considered but Rejected
1. Do nothing. Currently, HUD personnel keep the MPS one- and two- family dwelling program
functioning by working around antiquated program requirements and regulatory procedures.
This has caused confusion among homebuilders, homeowners, and policy makers. With the
retirement of the last experienced MPS manager early in 2002, the “do nothing” alternative has
become untenable—particularly since making the changes recommended above should not be
particularly difficult to achieve and would result in simply realigning the program to meet actual
current practices.
2. Reinstate the pre-1984 MPS requirements for one- and two-family dwellings. If the transition
to state and local building codes had not worked, this would be an option worth considering. But
the transition has in fact worked well, and, as mentioned above, HUD-insured properties are now
regulated by the same requirements that apply to all the other houses built and insured
nationwide—requirements that provide sound, safe, healthy, and livable housing to millions of
families.

23
Appendix A
DETAILED MPS CHRONOLOGY
Note: Underlining added for emphasis.
1922. Recommended Minimum Requirements for
Small Dwelling Construction. Report of the
Department of Commerce Building Code Committee,
Bureau of Standards, U.S. Department of Commerce.
U.S. Government Printing Office; Washington, 1922.
Initiated by a report of the Senate Committee on
Reconstruction and Production, appointed in by
Secretary Hoover 1920.
“The building codes of the country have not been
developed upon scientific data but rather on compromise;
they are not uniform in practice and in many instances
involve an additional cost to construction without assuring
more useful or more durable buildings.” Commerce
Secretary Hoover organized the Building Code Committee
at the Bureau of Standards in May 1921.”
1932. Updated Recommended Minimum
Requirements for Small Dwelling Construction.
Building and Housing Publication No. 18. Report of
the Department of Commerce Building Code
Committee, Bureau of Standards, U.S. Department of
Commerce. U.S. Government Printing Office.
Washington, 1932. Contains 25 pages of
requirements and 77 pages of acceptable practices.
Available in HUD library.
The requirements of this publication may have been
partially adopted by the early drafters of FHA’s
construction requirements.
National Housing Act signed on June 17, 1934 “to
encourage improvement in housing standards and
conditions, to provide a system of mutual mortgage
insurance, and for other purposes.” The Act creates
the FHA and allows it to insure actuarially sound,
low-interest, long-term mortgages on private homes.
Section 203(b) provides insurance for one-to-four
family dwellings.
Late 1934 or early 1935. Circular No. 2, Property
Standards: Requirements for Mortgage Insurance
under Title II of the National Housing Act. Federal
Housing Administration. Washington, D.C. The
earliest copy in the HUD Library is labeled “Revised
February 15, 1935.” There may be an earlier edition.
It is 16 pages in length and its contents are:
Objectives, 1-1/2 page

Article I, Definition of Terms, 1-3/4 pages
Article II, General, 1/3 page
Article III, Neighborhood Standards, 1 page
Article IV, Relation of Property to Neighborhood, 1 page
Article V, Land Utilization, 2/3 page
Article VI, Character of Design, 2/3 page
Article VII, Planning and Accommodation, 2-1/4 pages
Article VIII, Construction, 2-1/4 pages, with window
lighting area illustration
Article IX, Services and Equipment, 1 page
Article X. Local Standards and Exceptions, 1 page
Note that the emphasis is mostly on neighborhood
standards and planning, with construction and
equipment covered in three pages.
The inside cover and introduction state:
“One of five circulars of Information Available on Title II
of the National Housing Act. Others are Circ. No. 1,
Mutual Mortgage Insurance Regulations; Circ. No. 3, Low-
Cost Housing, Circ. No. 4, Operative Builders; Circ. No. 5,
Subdivision Development.
“This circular is issued for the purposes of guiding the
judgement of lenders contemplating applications for
mortgage insurance and of providing to borrowers,
architects, and builders information as to the policy of the
Federal Housing Administration in regard to the character
of properties which constitute eligible security for an
insured mortgage loan.
“The Federal Housing Administration, as the custodian of
funds accumulated from insurance premiums, must
eliminate, so far as possible, the risks to which these funds
may be subjected. The mortgage insurance facilities of the
Federal Housing Administration may be made available,
therefore, only to those properties whose prospects of
continued utility are sufficiently good to give assurance of
their enduring as ousnd investments throughout the life of
the mortgage.
“In addition, the National Housing Act definitely places
upon the Federal Housing Administration the obligation to
encourage improvement in housing standards and
conditions. While this obligation permits the
Administration to view property standards from
considerations of the security and well-being of the
occupants of dwellings, entirely apart from the factors
involved in the safety of the investment itself, it is the
conviction of the Administration that, in long-time
investment, the qualities which produce a satisfactory
social condition also tend to assure economic soundness.”
June 1936. Circular No. 2, Property Standards.
Requirements for Mortgage Insurance under Title
II of the National Housing Act. “Revised June 1,
1936.”
This is probably the next edition of Property
Standards, which has been increased to 23 pages:
Part I, Objectives, 3-1/2 pages
Part II, Desirable Characteristics, 7-1/2 pages (201
Location; 202 Planning of the Plot; 203 Planning of the

24
Dwelling;; 204 Design of the Dwelling; 205 Construction
and Materials; 206 Mechanical Equipment; 207 Plumbing;
208 Heating and Air-Conditioning; 209 Electric Wiring;
210 Insulation)
Part III, Definitions, 2-1/2 pages
Part IV, Conditions Determining Acceptability, 2 pages
(401 Plot; 402 Accessibility; 403 Number of Living Units;
404 Types of Eligible Dwellings; 405 Non-Residential Use
of Dwellings)
Part V, General Minimum Requirements, 5 pages (501
Local Regulations; Natural Light and Ventilation; 502 Lot
Coverage; 503 Dimensions of Front and Rear Yards; 504,
Dimensions of Side Yards; 505 Dimensions of Courts; 506
Windows; 507 Ventilation of Bathrooms and Water Closet
Compartments; 508 Ventilation of Basement, Laundry, and
Utility Rooms; 509 Living Unit; 510 Separation of Living
Units; 511 Privacy; 512. Ceiling Heights; 513 Storage; 514
Stairways; 515. Basement Rooms; 516 Construction of
Dwellings; 517 Approval of New Methods of Construction;
518 Protection; 519 Soil; 520 Foundations; 521 Chimneys,
Fireplaces, and Hearths; 522 Floors on the Ground; 523
Spaces Between Floors and Ground; 524 Defective
Conditions; 525 Compliance with Laws; 526 Plumbing
Fixtures; 527 Water Supply; 528 Approval of Wells; 529
Cisterns; 530 Sewage Disposal; 531 Sewage Disposal
Systems; 532 Approval of Sewage Disposal Systems; 533
Heating; 534 Electric Wiring)
Part VI: “Minimum Requirements contained in Part VI
defining these general requirements locally are published
separately for each insuring office.”
This edition provides for a supplementary
publication, called the “Minimum Construction
Requirements,” published separately by each insuring
office, to be part of the Property Standards, as Part
VI, above, explains.
The introduction to this edition states:
“The Federal Housing Administration has established
standards covering the physical characteristics of property
for two purposes. The first is stated in the preamble to the
Act, making it in effect the guiding principle of the
legislation, namely, “to encourage improvement in housing
standards and conditions.” the second appears in Section
203 and makes it mandatory upon the Administration to
provide assurances that “the project with respect to which
the mortgage is executed is economically sound.
“It is the conviction of the Administration that these
purposes, far from being conflicting, are essentially one,
and that from the point of view of long-term investment the
qualities which produce a satisfactory social condition will
provide also the best possible assurances of economic
soundness.
“In order to make sure that such qualities are in fact
present, certain general considerations have guided the
policy of the Administration. These refer especially to
(I) the soundness of the property to the equity holder;
(II) the regulation of the property to the neighborhood as
it affects security over a long period; and
(III) the characteristics of the individual property as
security for a long term mortgage.”
— 1937 (date varies among FHA insuring offices).
Property Standards, Part VI. Minimum
Requirements for the State of Texas. “Revised July
15, 1937.” 7 pages. Each insuring office made slight
changes to the FHA master copy. This edition begins
with this note:
“Note: These Local Minimum Requirements as contained
n Part VI are in addition to, define, and further qualify the
General Requirements as contained in Part V fo Circular 2,
Property Standards, for the district to which they refer. The
General Requirements in Part V are numbered to
correspond to the Local Minimum Property Requirements
in Part VI.”
In the State of Texas, the Minimum Requirements
were revised in June 15, 1938 and January 15, 1939.
This revision pattern is typical for all the insuring
offices, with the first Minimum Requirements being
issued in 1937 or 1938 and the last in 1939 or 1940.
Only minor changes were made in each revision and
the page count (7) remained the same. All were
printed by the Government Printing Office.
— 1937 (date varies among FHA insuring offices).
Minimum Construction Requirements for New
Dwellings. Federal Housing Administration, St.
Louis, Mo. “Revised February 15, 1937.” This is the
first stand-alone edition of the Minimum Construction
Requirements which, in 1958, become the Minimum
Property Standards. Similar to the Property
Standards, each insuring office made slight changes
to the FHA master copy.
This early edition of the Minimum Construction
Requirements is 17 pages in length and covers the
following topics:
Excavation; Masonry (General, Footings, Foundations,
Exterior Walls, Chimneys, Cement floors, driveways, and
walks)
Dampproofing
Structural Steel and Iron
Lumber
Termite Protection
Framing (Floors and roofs, Exterior Walls, Spans [added
ca. 1938], Interior Partitions)
Miscellaneous
Roof Coverings
Sheet Metal
Lathing
Plaster Work
Stucco
Painting
Electric Work
Plumbing
Heating
General
Full-age illustration containing footing, chimney, sill, and
framing details.

25
The preface states:
“1. The requirements contained herein provide for a
Minimum Standard of Construction for properties offered
as security for an insured mortgage and shall apply to all
new construction on which the mortgage is insured by the
Federal Housing Administration.
“NOTE. These requirements do not eliminate the
necessity of providing complete specifications in
connection with new construction.
“2. Strict compliance the Local Building Code
Requirements and Sanitary Regulations, together with the
provisions contained in the specifications submitted will be
required in all cases. It is understood that the requirements
set forth herein are purely minimum. These requirements
are not to be built down to but form a basis to build up
from, and the Administration will recognize and give credit
to construction that exceeds these Minimum Construction
Requirements. The Minimum Construction Requirements
shall be applied—
(a) When the requirements contained in the
specifications submitted are not specific or are
lower than those contained in the Minimum
Construction Requirements
.
(b) When the requirements of applicable Building
Codes and Regulations are of a lower standard
than those contained in the Minimum
Construction Requirements.
(c) Where there are no existing Local Building
Codes and Regulations.”
— 1937 (date varies among FHA insuring offices).
Minimum Construction Requirements for New
Dwellings. Federal Housing Administration,
Indianapolis, In. “Revised December 1, 1937.”
Revised edition of the MCR for the Indianapolis
office.
‘The MCR has been increased to 24 pages plus a full
page of construction details, with virtually the same
subject headings and content as above, but with a
greatly expanded span section under Wood Framing
and minor expansions of most other headings. Span
tables have become a separate heading.
“In the Baltimore FHA office, the first Minimum
Construction Requirements was issued on May 1,
1937. It was reissued on August 1, 1938, August 15,
1939, and February 15, 1941. The number of pages
was 21 for the 1937 edition and 25 for the ones that
followed. Beginning in 1940, a note on the inside
front cover stated, ‘For requirements applying to
single-family 1-story detached dwellings, see
“Supplemental Property Standards and Minimum
Construction Requirements for [state or district
insuring office].’”
The state and district FHA insuring offices seem to
have adopted their first edition of the MCR in 1937
or 1938 and republished it, with minor revisions and
local variations, every year or so until 1940 or 1941.
All were printed by the Government Printing Office.
A second paragraph has been added to the standard
preface, as follows:
“2. Because of the wide variation in building code
requirements covering materials and specific features in
building construction, no attempt has been made to make
the provisions contained herein comply with building code
regulations. The Federal Housing Administration has used
the recommendations of the National Bureau of Standards,
United States Department of Commerce; the Forest
Products Laboratory, United States Department of
Agriculture; and the Public Health Service, United States
Treasury Department, as a basis for setting up these
requirements. The requirements contained herein are
considered necessary to produce a well-constructed
dwelling which will serve as sound security for a long-term
mortgage loan. However, strict compliance with the local
building code requirements and sanitary regulations,
together with the provisions contained in the specifications
submitted, will be required in all cases where such
requirements, regulations, and provisions are of a higher
standard than those contained herein.”
National Housing Act Amendments create Federal
National Mortgage Association and authorize FHA
insurance on 90-percent financing with a term of up
to 25 years for low-cost, owner-occupied properties.
January 1942. Master Form, Property Standards
and Minimum Construction Requirements for
Dwellings. The one FHA master copy in the HUD
Library, “Revised January 1942.” Contained:
Foreword
Property Standards
Minimum Construction Standards
Drawings and Specifications Requirements
Appendices (Span tables, Definitions, Standards)
Suggested Construction Details.
This publication combines, for the first time, the
Property Standards and the Minimum Construction
Requirements into one document.
— 1942 (date varies among FHA insuring offices).
Property Standards and Minimum Construction
Requirements for Dwellings Located in the
Southern California District. “Revised January 1,
1942.” Typical edition. Apparently based on the
January 1942 FHA master form.
May 1942. Minimum Requirements for Rental
Housing Projects. A spin-off of the MCR, which
previously applied only for dwellings. This may have
been the beginning of the multifamily requirements.
January 1943. Amendments to the Minimum
Property Requirements for All New Dwellings.

26
“Revised January 21, 1943.” Amends the MCR for
materials in short supply. The preface states:
“Consistent with the objectives of the War Housing
Construction Standards, revised January 21, 1943, issued
jointly by the War Production Board and the National
Housing Agency, the following amendments to the Federal
Housing Administration Minimum Construction
Requirements supersede the Amendments to the Minimum
Construction Requirements issued under date of November
18, 1942 and apply to all new construction offered as
security for insured mortgages under the National Housing
Act. These amendments shall apply on to those phases of
the construction which are affected by the shortages of
critical materials and they supercede all conflicting
requirements currently effective. The current local
Minimum Construction Requirements remain in effect with
respect to all phases of the construction which are not so
affected.”
September 1945. Master Draft of Proposed
Minimum Property Requirements for Properties of
One or Two Living Units. “Revised September
1945.” The first post-war master form. Puts FHA
Property Standards and Minimum Construction
Requirements into two sections titled “Minimum
Planning Requirements” and “Minimum Construction
Requirements.” References three new documents,
“Minimum Property Requirements for Properties of
Three or More Living Units,” “Minimum Subdivision
Regulations,&rdquo; and “Minimum Street Improvement
Requirements for Residential Developments.”
Contains detailed, prescriptive construction
requirements. Unnumbered; about 180 pages, type-
written.
— 1946 (date varies among FHA insuring offices).
Minimum Property Requirements for Properties of
One and Two Living Units Located in the State of
Tennessee, Memphis Insuring Office. “Revised
December 1946.” About 180 pages (typewritten).
Makes reference to “Minimum Property
Requirements for Properties of Three or More Living
Units” and “Minimum Street Improvement
Requirements for Residential Developments.”
Typical early post-war edition that combines the
former Property Standards and Minimum
Construction Requirements into one document.
July 1946. Minimum Property Requirements for
Properties of Three or More Living Units. Revised
October 1946 and August 1948. Probably the first
multifamily edition.
August 1947. Significant Variations of the
Minimum Property Requirements of FHA Insuring
Offices. August 1947. Explains variations “for
manufacturers marketing on a national basis,”
apparently in response to post-war interest in
industrialized housing.
Housing Act of 1948 allows the FHA to insure
mortgages with only 5 percent down and with 30-year
terms on low cost homes.
Housing Act of 1949 sets the goals of “a decent
home and a suitable environment” for every U.S.
family. Title I creates the urban renewal program.
Title V creates the basic rural housing program under
the Farmers Home Administration.
— 1949 (date varies among FHA insuring offices).
Minimum Property Requirements for Properties of
One and Two Living Units Located in Six Southern
States: Georgia, Alabama, South Carolina, North
Carolina, Mississippi, and Tennessee. “Revised
January 1949.” About 220 pages. Each edition now
covers several states—the beginning of greater
uniformity in requirements—and were typically
revised every few years from 1946 or 1947 through
the 1950s.
Housing Act of 1954 liberalizes terms for FHA-
insured mortgages.
November 1958. Minimum Property Standards for
One and Two Living Units. First 8-1/2x11" format,
315 pages. The MPR is now renamed the MPS and
for the first time covers the entire country. Regional
editions have been eliminated. The foreword and
introduction state:
“These new Minimum Property Standards are intended to
encourage new methods and new ideas which will result in
better and more economical housing for American families.
“FHA is indebted to many industry leaders and
professional advisors for their assistance in preparing these
Minimum Property Standards and we gratefully
acknowledge our appreciation.”
“The purpose of the National Housing Act, as stated in the
preamble, is ‘to encourage improvement in housing
standards and conditions, to provide a system of mutual
mortgage insurance, and for other purposes.’
“In pursuance of this purpose, the Federal Housing
Administration has established these Minimum Property
Standards. They are intended to obtain those characteristics
in a property which will assure present and continuing
utility, durability and desirability as well as compliance
with basic safety and health requirements. To provide this
assurance, these standards set forth the minimum qualities
considered necessary in the planning, construction and
development of the property which is to serve as security
for an insured mortgage.
“As these standards define the minimum level of quality
acceptable to FHA, a property complying with them is
considered technically eligible in all FHA insuring office

27
jurisdictions. Other factors, however, such as the
appropriateness of the dwelling to the site and to the
neighborhood and the anticipated market acceptance of the
property as a while must also be considered in FHA
underwriting analysis.
“Planning and construction which exceed the minimums
set forth herein and which will result in increased
marketability of the property or which will reduce the
expense of maintenance or early replacement of equipment,
will be reflected in the FHA estimate of value.
“The standards are based upon extensive study by the
technical staff of FHA headquarters and field offices, and
upon recommendations of builders, architects, engineers
and material producers. While they represent good current
practice in residential technology, they may be modified in
the future as additional data and experience are gained.
“The standards are not intended to serve as a building
code. Such codes are primarily concerned with factors of
health and safety and not the many other aspects of design
and use which are included herein as essential for mortgage
insurance determinations.”
March 1959. Review of Minimum Property
Standards for One and Two Living Units. Federal
Housing Administration. Explains why the state and
regional editions have been combined into a single
national standard, and why the name has been
changed from MPR to MPS. The introduction states:
“Notice. It is not intended that this “Review” be used as a
substitute for the Minimum Property Standards for One and
Two Living Units. Its purpose is to help explain the reasons
for the major items which are changes from the old MPR or
additions which were considered to be essential.
“In 1951 there were 51 separate editions of the MPR’s in
use. By 1956 the number had been reduced to 21. Even that
was too many. It was not only hard on builders to have 21
sets of requirements—it was hard on the FHA itself to
make consistent interpretations, keep them all revised and
to stock the various quantities needed.
“As builders increased the scope of their operations,
distances began to shrink. Local customs began to be
absorbed in a more general pattern of construction
practices. The multiple MPR’s were unsatisfactory on this
account, and in addition they were out of date in many
respects as well as being deficient or incomplete in others.
They needed to be consolidated, clarified, and updated.
“In view of all this, the PHA Commissioner ordered the
technical standards staff in the Washington office to
restudy the existing requirements and to prepare a set of
standards that would apply throughout the United States.
He pointed out that this would not necessarily mean raising
or lowering the requirements then in effect. The main thing
was to clarify and standardize the requirements to make
them more effective in helping the industry to build good
homes.
“In spite of all the progress and changes that have taken
place in homebuilding, it is still governed to some extent
by local custom and tradition. Things are often done in a
certain way simply because that is the way they always
have been done. The old accepted ways are hard to
dislodge, and they often stand in the way of new technical
developments. This was one of the difficulties faced by
FHA in undertaking to rework its requirements and make
them uniform.
“It was decided that the best way to do the job would be
to forget the old MPR’s and make a completely new start.
“Basic Determinations:
.
“1. One set of standards would be established for use
anywhere in the United States.
“2. The title would be “Minimum Property Standards”,
since standards of performance were the aim and purpose.
“3. The standards would define the minimum level of
quality acceptable to FHA and to VA, keeping in mind the
dual objective of reaching the needs of purchasers in low
income brackets and at the same time assuring the
purchaser full value for his dollar.
“4. The standards would be designed for use by both
small and large builders. They would cover everything
necessary, and they would be spelled out so clearly that
there would be the least possible need for interpretation and
the least possible chance of misinterpretation.
“5. In arrangement as well as consent, the book would be
planned for the convenience of those who would use it
most—builders, architects, and engineers.
“6. Generally accepted standards developed by nationally
recognized authorities would be relied on for determining
whether materials were suitable, how they should be tested
and assembled, and how they should be expected to hold
up when in use.
“7. Illustrations should be used whenever they would help
to explain a standard.
“8. Requirements that would apply only in certain
localities would be omitted.
“Public Cooperation:
“The Commissioner appointed a small task force of FHA
technicians to devote their full time to preparing the new
standards. He also appointed an advisory committee
representing a number of industry groups.
“Setting up a set of standards for nationwide use was a job
that needed the knowledge and experience of the entire
homebuilding industry. That knowledge and experience
were sought and were made available very generously.
“The FHA task force began by codifying the 21 sets of
minimum property requirements in order to see where they
differed from one another and why. A working committee
of Chief Architects from each of the six FHA zones of
operation in the field was called in to headquarters for two
three-week sessions of discussion and suggestion.
“The FHA task force sought to consult every group in the
construction field. They consulted all the FHA field
offices, gathering from the comments and
recommendations based on their experience of more than
20 years in the housing field. A group of Chief Architects
from the field offices of FHA who were called into
Washington to assist in the initial development of the new
standards were appointed technical advisors at the
Women’s Congress on Housing in 1956. The discussions
and recommendations of this Congress resulted in more
complete understanding of the desires, needs and problems
of the homeowner and assisted in determining how they
could be related to any standards set up by FHA.
Subsequently another committee of women representing

28
the consumers was invited to submit their
recommendations. The task group consulted materials
manufacturers, architects and engineers and over 150 trade
associations. In fact, they sought the advice of any group
that had studied a particular phase of dwelling construction
or for any other reason might have something to contribute.
More than 2,000 copies of the third draft of the proposed
standards were distributed, and comments were received
from most of the recipients.
“Meanwhile, the National Association of Home Builders
had appointed a Special Technical Committee which met in
July, September, and November, 1957, to review
comments resulting from scores of meetings on the
proposed standards held by local builders associations
throughout the country. In October 1957, and in January
and April, 1958, FHA officials met with the NAHB
Committee to go over, step by step, the comments of the
local builder groups and the recommendations of the
NAHB Committee.
“Altogether 4 drafts of the standards were prepared. The
final result is a set of standards for which the industry itself
is largely responsible. It represents an outstanding
cooperative effort by industry and Government.
“The same spirit of cooperation will bring about a smooth
change-over from the old MPR to the new Minimum
Property Standards.
“The present Minimum Requirements for Low Cost
Housing under the National Housing Act will continue in
effect until July 1, 1959, by which time a revision will have
been released relating them to the new Minimum Property
Standards.”
May 1963. Minimum Property Standards for Urban
Renewal Rehabilitation, One to Eleven Units. An
MPS version that existed during the 1960s. Revised
June 1966. Later changed to Minimum Design
Standards for Rehabilitation of Residential
Properties. No longer published.
Housing and Urban Development Act of 1965
establishes HUD.
HUD reorganization of 1969-1970 ends the FHA’s
long tradition as an independent agency with a
separate staff and autonomous budget authority.
1973. Minimum Property Standards published in four
volumes: Volume 1, MPS for One and Two Family
Housing; Volume 2, MPS for Multifamily Housing;
Volume 3, MPS for Care-Type Housing; Volume 4,
Manual of Acceptable Practices to the HUD MPS.
The new Manual of Acceptable Practices is extensive
and “provides design and construction methods which
have been demonstrated to perform satisfactorily in
residential construction in most parts of the country.”
Each MPS volume had this foreword:
“A Congressionally directed objective of the Department
of Housing and Urban Development is to encourage
improvement in housing and residential land development
standards and conditions. The publication of these revised
Minimum Property Standards provides the Department for
the first time with a single unified set of technical and
environmental standards. They define the minimum level
of acceptability of design and construction standards for
low-rent public housing as well as housing approved for
mortgage insurance.
“HUD is indebted to the many organizations of the
housing industry, to the other Federal and State agencies
and to individual professional advisors for their valuable
assistance in reviewing and commenting on the drafts of
these MPS, and gratefully expresses appreciation.”
1978. Public Law 95-619 adds energy performance
requirements to the MPS to achieve a significant
increase in the energy efficiency of new construction.
In 1983, Pub. L. 98-181 amends this, requiring that
the energy performance requirements for residential
housing be at least as effective as those in the MPS in
effect on September 30, 1982.
“12 USC Sec. 1735f-4. (a) To the maximum extent
feasible, the Secretary of Housing and Urban Development
shall promote the use of energy saving techniques through
minimum property standards established by him for newly
constructed residential housing, other than manufactured
homes, subject to mortgages insured under this chapter.
Such standards shall establish energy performance
requirements that will achieve a significant increase in the
energy efficiency of new construction. Such requirements
shall be implemented as soon as practicable after
November 9, 1978. Following November 30, 1983, the
energy performance requirements developed and
established by the Secretary under this subsection for
newly constructed residential housing, other than
manufactured homes, shall be at least as effective in
performance as the energy performance requirements
incorporated in the minimum property standards that were
in effect under this subsection on September 30, 1982.”
1979. Minimum Property Standards, One and Two
Family Dwellings, HUD Handbook 4900.1. 196
pages plus appendices. The foreword states:
“These Minimum Property Standards are intended to
provide a sound technical basis for the construction of
housing under the numerous programs of the Department
of Housing and Urban Development. The standards
describe those characteristics in a property which will
provide present and continuing utility, durability, economy
of maintenance, and a safe and healthful environment.”
August 1980. Recommendations for Solutions to
Permit Compatible Use of the One and Two Family
Code and the Minimum Property Standards.
National Association of Homebuilders Research
Foundation. This report to HUD, quoting extensively
from a 1978 report by a HUD Task on Housing
Costs, states (with Task Force quotes in italics):
“The MPS originated as a set of mortgage insurance

29
criteria to assure the health, safety, durability and
marketability of homes financed under FHA programs. In
the past, much of the housing in the U.S. was produced
under these programs. In the post World War II period up
to the early 1960’s a majority of middle priced housing was
sold with FHA-insured mortgages. The added security
afforded to the lenders made long term, low down payment
mortgages available to millions of Americans who could
not otherwise have afforded a home. The program was self
supporting through a small surcharge in the mortgage
payment.
“During this period the Minimum Property Requirements
(MPR), later called the Minimum Property Standards
(MPS), played a major role in assuring the construction of
sound, marketable housing. It also had a tremendous
influence on establishing and standardizing sound building
practices beyond FHA jurisdiction. At the time, the MPR
represented the first complete set of practical building
standards in the U.S. It was essentially a textbook for home
building with detailed instructions and illustrations for all
phases of construction, written in simple language and
logical format for the home building industry. Many
builders were influenced to alter their practices, resulting in
better homes at less cost. Lenders were better able to judge
the soundness and value of homes for mortgage
applications. Building code groups modified their
requirements to resemble the superior technical provisions
of the MPS. Manufacturers were able to standardize
products and market them nationally, and FHA approval of
a product became paramount to market acceptance.”
“In fact, the earlier FHA program was so successful that
the private financial sector became convinced that they
could assume the same risks on a profitable basis. At the
same time, building codes were becoming more responsive,
and most communities who previously had an inadequate
code or no code at all were adopting an updated building
code based on a national model code. Meanwhile, building
methods, materials and products had become increasingly
standardized across the U.S. In short, there was a new
climate portending a long term decline in FHA activity in
home building, and a steadily decreasing role for the MPS.

“The HUD Task Force on Housing Costs in their final
report in May 1978 recognized the adverse cost impact of
duplicative and conflicting regulations on housing costs.
The task force identified ‘the proliferation of government
regulations (at all levels), many of which are unduly
burdensome…’ as ‘factors in escalating the costs of
financing, land development, housing construction and
rehabilitation, supporting amenities, and occupancy.’ A
‘major solution’ to these problems was ‘a blunt attack on
poorly conceived and cost-inducing regulation.’ It was
further noted that ‘the federal government cannot expect
state and local governments to improve their methods of
operation, nor can it hope for massive private participation
until HUD and its companion agencies sweep their houses
clean of excessive requirements, dilatory processing, and
inefficient management.’
“The Task Force recommended, ‘At a minimum, the MPS
should be reconciled with a revised nationally recognized
consensus version of the 1-2 Family Dwelling Code.
Furthermore, a housing unit which is structurally and
mechanically sound and which conserves energy can be
more basic in terms of space and amenities than current
MPS allow. The design requirements imposed through the
MPS are excessive and inflexible. It is clear that the MPS,
as currently written and interpreted, does not enable
developers to construct or renovate housing to meet the
marketable shelter needs of all possible consumers. We
also find it desirable for HUD to explore ways of adjusting
the MPS to the provisions of revise 1-2 Family Dwelling
code…’ It was recommended that ‘HUD should revise the
MPS to allow design and construction or renovation of
otherwise marketable low-priced basic, starter, unusual, or
different types of housing, both single-Family and
multifamily; and study current MPS requirements and
immediately remove unjustifiable cost-increasing technical
and design requirements from the MPS.’ Further, it was
noted that Section 101(a) of the Housing Act of 1949
requires the Secretary to consider ‘the elimination of
restrictive practices which unnecessarily increase housing
costs and encourage code or land use control revisions
which cut the cost of housing.”
“It was generally concluded that the 1-2 Family Dwelling
Code offers a viable and logical alternative to MPS
health/safety requirements in its present form, and should
be accepted as such by HUD as soon as possible.”
“The remaining portion of the MPS dealing with other
requirements related to mortgage insurance, various
Federally mandated items or other HUD operations should
also come under scrutiny…Regulations pertaining to such
areas as appearance, livability and marketability represent
arbitrary value judgments. The Minimum Property
Standards no longer represent minimum standards for
adequate housing. Such arbitrary provisions have tended to
escalate in recent years, partly through a narrow
interpretation of HUD’s mandate to improve the “quality of
housing”. A broader interpretation of this mandate,
however, would hold that the overall quality of housing can
be improved by making affordable housing available to an
increasing proportion of the populace who cannot now
afford a home. Many of these people are less concerned
with the level of quality, features and amenities than with
the availability of a clean, safe and sound home that they
can afford. The effect of unnecessary quality-related
requirements is to deny an adequate home to many of these
people. The alternative is substandard housing.”
1981. Issue Paper on the Minimum Property
Standards. From “Selected Background Papers:
Housing Construction Codes and Standards.” HUD
Office of Policy Development and Research.
November 1981. Discusses the background of the
MPS and presents three options for action, with pros
and cons for each: (1) Do nothing; (2) Make the MPS
identical to the CABO One and Two Family Code;
and (3) Phase out the MPS and depend entirely on the
local codes and marketplace. The full text of this
paper is presented in Appendix B.
1982. Minimum Property Standards, One and Two

30
Family Dwellings, HUD Handbook 4900.1, 1982
Edition. The introductory statement is identical to that
of the 1979 edition, but the foreword states that One-
and Two-Family MPS will be phased out.
“This revision of the Minimum Property Standards for
One- and Two-Family Dwellings will be the last revision.
The content of this revision is reduced in substance and in
bulk. It reflects the policy of the Department to move away
from imposing Federal standards where market forces,
local requirements and nationally recognized standards
developed in the private sector serve to achieve the same
goals.
“Thus, many of the ‘livability and marketability’
provisions have been eliminated, provisions from the One-
and Two-Family Dwelling Code developed by the Council
of American Building Officials replace analogous MPS
requirements, and quotations from readily available
standards are referenced rather than repeated.
“This revision is a step toward phasing out the Minimum
Property Standards for One- and Two- Family Dwellings
because they have largely accomplished their purpose. The
Department is indebted to the many groups whose
recommendations support our conclusion that both the
Department’s and the home buyers’ interest can be
protected with less Federal intervention.”
1983. Public Law 98-181, title IV, Sec. 405, permits
HUD to require that HUD-insured housing comply
with model or local building codes, effectively
allowing the elimination of the MPS for One- and
Two-Family Dwellings:
“12 USC Section 1735f-4. (b) The Secretary may require
that each property, other than a manufactured home,
subject to a mortgage insured under this chapter shall, with
respect to health and safety, comply with one of the
nationally recognized model building codes, or with a State
or local building code based on one of the nationally
recognized model building codes or their equivalent. The
Secretary shall be responsible for determining the
comparability of the State and local codes to such model
codes and for selecting for compliance purposes an
appropriate nationally recognized model building code
where no such model code has been duly adopted or where
the Secretary determines the adopted code is not
comparable.”
1984. Minimum Property Standards for Housing,
HUD Handbook 4910.1, 1984 Edition with Changes.
With this edition, the MPS for One- and Two-
Dwellings and the MPS for Multifamily Housing
have been combined into one document, with the
MPS for One- and Two-Dwellings renamed “Rules
for One and Two Family Dwellings” and consigned
to a 31-page Appendix K. Most of the material in
Appendix K addresses ways of determining which
model and local codes can be used.
1994. Minimum Property Standards for Housing,
HUD Handbook 4910.1, 1994 Edition. This is the
current edition of the MPS, as published in the Code
of Federal Regulations at 24 CFR 200.925 and
200.925a–e. This edition changes the name of
Appendix K to “Minimum Property Standards for
Property which is not Multifamily or Care-Type
Property” and reduces Appendix K’s size to 26 pages.
Appendix K is identical to the 1984 edition except
that the reference standards are updated, the term
“physically handicapped” is changed to “disabled,”
FEMA requirements under the National Flood Hazard
Program are added, and a reference to the Model
Energy Code replaces an extensive energy
conservation section.
The foreword and introduction to the 1994 MPS state:
(Foreword:) “These Minimum Property Standards
reference nationally recognized model building codes for
concerns relating to health and safety. Locally adopted
building codes can be used for the same purpose when they
are found acceptable by the HUD field office.
“These standards establish the acceptability of properties
for mortgage insurance, and will further the goal of a
decent and suitable living environment for every American
family. These standards will protect the Department’s
interest by requiring certain features of design and
construction which are not normally required by state and
local codes. These requirements will insure the durability
of the project for the life of the mortgage.”
(Introduction:) “These minimum Property Standards
(MPS) are intended to provide a sound technical basis for
the construction of housing under the numerous programs
of the Department of Housing and Urban
Development......Chapters 1 thru 6 and Appendices A thru
J now apply to multifamily and care-type housing.
Appendix K applies to one and two family dwellings.”
May 2001. International Code Council, Inc., submits
its Proposed 2001 Edition of the Minimum Property
Standards for Housing, dated May 3, 2001.
Proposed changes to Appendix K mainly have to do
with updating referenced codes and standards, in
almost all cases to the International Residential Code,
2000 Edition.

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Appendix B
1981 HUD “ISSUE PAPER ON THE MINIMUM PROPERTY STANDARDS”
From “Selected Background Papers: Housing
Construction Codes and Standards,” HUD-2451,
November 1981
Abstract
The history and influence of the HUD single family MPS is
described, followed by a discussion of the development of
the One and Two Family Dwelling Code. The paper then
discusses the MPS in transition and recommendations for
reliance on local codes and the marketplace to govern the
design and construction of insured housing in the same way
as housing which is conventionally financed.
Finally, the paper describes the pros and cons of various
degrees of Federal regulations vs. local control over all
housing design and construction.
A. Statement of Issues
1. What is the current status of standards pertaining to
single family and low and high rise multifamily? What is
the timetable for changes to these? To what extent does
HUD plan to rely on private sector codes and standards?
2. Are the MPS minimum in the sense of meeting health
and safety concerns? If not, where are they standards more
stringent, and for what purposes (e.g. marketability)?
3. To what extent do underwriting considerations dictate
the content of the MPS and why?
B. Analysis
1. Background of the Minimum Property Standards (MPS)
In order to understand the current status of and possible
future options regarding the Minimum Property Standards
(MPS), it is appropriate to begin with a short summary of
its original purpose and subsequent development.
The MPS was an integral part of the Federal Government’s
efforts to rescue and restructure the nation’s housing
markets in the 19030's. A cornerstone of these efforts was
the establishment of the Federal Housing Administration in
the “National Housing Act of 1934". The major purpose of
the Federal Housing Administration (FHA) was to reduce
lenders’ risks by providing mortgage insurance on
residential loans. At the same time, this policy would
assist homeowners and stimulate construction because
these insured loans were to have low down payments and
be self-amortizing over period as long as 30 years. Propr
to FHA, housing was generally financed with short-term
(3-5 years), high down payment (typically 50%), non-
amortizing loans with the principal due at the end of the
term.
In order to induce lenders to make this radically new type
of loan, the Federal government undertook several steps,
including the development of the MPS. The main
reference in law for the MPS was the opening in housing
standards and conditions, to provide a system of mutual
mortgage insurance, and for other purposes.” The MPS
was established to assure lenders about the quality of the
housing which they were being asked to finance in this
entirely new way, as well as to establish the soundness of
the FHA insurance fund. More specifically, the MPS was
developed to meet the requirements of the 1934 legislation
to insure housing which was “decent, safe and sanitary.” A
national standard was used because of the uneven quality
of codes and building inspection process in many areas and
the absence of any codes in other areas at that time.
Through the establishment of the Federal National
Mortgage Association in 1938, lenders across the country
had a mechanism to buy and sell FHA mortgage loans.
The MPS, both in terms of its “health and safety”
provisions and its various underwriting criteria, provided a
means by which lenders buying loans on properties outside
of their immediate areas could judge the properties to be
acceptable from an underwriting perspective.
Finally, the MPS helped assure that FHA-insured
properties, when foreclosed and acquired, could be resold
at a minimum loss to the insurance fund.
The initial MPS document was issued in 1935; by 1940
multifamily projects were covered in a separate
publication. Since this time, the MPS has been revised
several times and its coverage and requirements have
generally increased as part of the general Federal mandate
to improve the quality of the nation’s housing stock.
Today, the MPS applies not only to FHA-insured housing,
but officially extends to HUD’s public housing and other
subsidy programs and to the Veterans Administration and
Farms Home Administration housing programs. Together,
this coverage accounts for about 20% of all new housing
starts. In addition, the MPS has over time come to be used
as a reference standard for many conventional financed
housing units; many of its provisions have been
incorporated into State and local building codes and
generally accepted appraisal and underwriting procedures.
2. Background of the One and Two Family Dwelling Code
Whereas the MPS was created to meet the requirements for
“decent, safe and sanitary” housing, building codes had
been developed under the obligations of the states to
protect the “health, safety and public welfare” of their
citizens. Generally this obligation was delegated by the
States to the local governing bodies. In this process of
code development, and especially under the several model
building codes, housing design and construction received
little specific attention.
Since 1934, suburban areas outside the jurisdiction of the

32
cities have enjoyed a period of continuing growth and
expansion, often in the absence of local regulation.
Typically, when an area grew and became politically
sophisticated it would develop zoning regulations and
adopt a building code. These codes covered all types of
buildings, with very little attention devoted specifically to
one and two family housing. In addition, each jurisdiction
developed its own code based on local conditions; even
when model codes were adopted dependence on
interpretation by the local inspectors has led to vast
differences in requirements from one community to the
next.
This code confusion, especially among home builders who
were beginning to broaden their activities and build under
several governmental jurisdictions, brought the three
nationally recognized model code bodies together in 1970
to create the One and Two Family Dwelling Code. Much
of its content was drawn from the MPS. For underwriting
purposes, over a period of time HUD had incorporated
more and more requirements in the areas of durability and
marketability. For instance, the MPS has emphasized the
need for at least minimum level of kitchen cabinet spaces,
storage space in closets, and other space needs, none of
which has any relationship to health and safety. While the
One and Two Family Dwelling Code is primarily a health
and safety code, it also contains sections above and beyond
its health and safety code, it also contains sections above
and beyond it’s health and safety provisions, such as
minimum room size requirements. This may be an
acceptance of a broader interpretation of the term “public
welfare”, or it could be an adoption of some of the more
readily acceptable marketability features from the MPS.
The One and Two Family Dwelling Code has not yet been
widely adopted by local governments, but an NAHB
Research Foundation survey found that, of the houses built
in 1978, 28 % were constructed in jurisdictions which had
adopted the code.
3. The MPS in Transition
The single family MPS has become, either directly or
indirectly, a widely used document. In addition to its use
for Federal programs it is widely referenced by home
builders, lending agencies, and manufacturers of residential
building products across the country. It is also widely
copied by local authorities, insurance companies, and
banks in writing their codes and standards requirements for
construction under their own programs. For example the
township of Levitttown, New Jersey, during its
construction period in the late fifties, adopted the HUD
single family MPS as its dwelling code.
Because of this widespread influence over virtually all
housing built during the last 25 or 30 years, a market has
developed whereby the consumers have come to expect a
certain size shape, and amenity level which would
undoubtedly continue even if the MPS were to cease to
exist. In fact, the buying public now demands most of the
underwriting, or marketability, features required by the
current MPA. This is not to state that it has become an
altogether redundant document, but rather to say that in
those jurisdictions where the local codes are adequately
enforced they have already, in effect, replaced the
necessity for Federal enforcement of an additional layer of
standards. The MPS has over the period of its 45 years
fully accomplished the purposes for which it was
developed. The country is now ready for a transition from
the MPS to dependence upon the codes and the demands of
the market.
An analytical comparison of the HUD single family MPS
and the One and Two Family Dwelling Code performed by
the NAHB Research Foundation concluded that the Code
offers a viable and logical alternative to the MPS health
and safety requirements in its present form, and should be
accepted as such by HUD.
C. Options
Three alternatives seem to be available:
Option 1. Do nothing. Continue using the MPS as in the
past.
Pros
– This is the easy way. No further debate or negotiations
are necessary on HUD’s part.
– The document is already well-known and used by the
industry. No adjustments to a new document are
necessary.
– HUD central office and field office staffs are not in place
for revision and enforcement.
Cons
– Revision and enforcement require a continuing
involvement of HUD staff at both central office and field
office levels.
– Builders must conform to both the MPS and local codes
if they build VA, FmHA, or HUD insured housing.
Discussion
This option ignores the recognized need for reducing
regulation at the Federal level. Because of the high degree
of visibility and the size of the MPS, the administration
could be criticized for not tackling an obvious regulatory
issue.
Option 2. Revise the MPS to make it identical to the One
and Two Family Code, which essentially means that HUD
would adopt the One and Two Family Dwelling Code in
place of the MPS. This allows the market to regulate the
insurance standards.
Pros
– Maintenance of a standard would no longer require a

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large HUD staff.
– Builders would be governed by only one code in areas
which had adopted the One and Two Family Code.

– Lower building costs could result from use of the One
and Two Family Dwelling Code, which is being kept up to
date by CABO.
Cons
– Builders in local jurisdictions which have not adopted the
One and Two Family Dwelling Code still must meet two
sets of requirements.
– Would require legislation to eliminate MPS requirements
now mandated by the Congress such as the energy saving
requirements and the technical suitability of materials
program.
Discussion
Reliance upon the code and the marketplace for HUD
insured housing could be realized in those areas of the U.S.
where the local governments have adopted the One and
Two Family Dwelling Code.
Option 3. Phase out the MPS and depend entirely on the
local codes and the marketplace.
Pros
– Gives local communities more control over their own
dwelling construction.
– Releases HUD responsibility for maintaining the MPS.
Cons
– Code uniformity might be slow in coming because of
differing local requirements.
– Would require legislation to eliminate MPS requirements
now mandated by the Congress such as the energy saving
requirements and the technical suitability of materials
program.
– Must confront the FmHA and VA problems.
Discussion
This option would probably be slow in progressing to the
ultimate goal of complete phase-out. The health and safety
provisions would be removed in favor of acceptable local
code provisions, along with removal of those underwriting
requirements that are traditionally controlled by the local
markets. One major problem with this option is that there
would be no standard available in areas without building
codes where housing is now being built. Some special
procedure might be required in such areas.
Current Status
Modest revisions to the single family MPS were published
for proposed rule making in the Federal Register in
September, 1980. Extensive revisions to the proposed rule
are now in process in response to the comments received
following that initial publication. Proposed changes
resulting from those comments would delete large portions
of the MPS in favor of letting the local market conditions
prevail where possible. Other changes would remove these
portions duplicated by the One and Two Family Dwelling
Code. The final rule will be published pending a decision
on the need for an environmental impact statement. The
discussions in this paper reflect the changes now being
proposed for the single-family MPS.

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Appendix C
MPS APPENDIX K
“Minimum Property Standards for Property Which Is Not Multifamily or Care-Type Property”
Note: Shaded areas denote instructions to HUD field
offices for determining code comparability or contain
supplemental code requirements. Italicized areas denote
information about the Technical Suitability of Products
(TSP) Program. Unshaded areas contain the vestiges of the
former MPS for one- and two-family dwellings and
constitute the last remaining non-code requirements:
Sec. 200.926 Minimum Property Standards for One-
and Two-Family Dwellings
(a) Construction Standards.
(1) Applicable structures. The standards identified or
contained in this section and in Secs. 200.926a-200.926e,
apply single family detached homes, duplexes, three-unit
homes, and to living units in a structure where the units are
located side-by-side in town house fashion. Section
200.926d(c)(4) also applies to four-unit homes.
(2) Applicability of standards to new construction. The
standards referenced in paragraph (a)(1) of this section are
applicable to structures which are:
(i) Approved for insurance or other benefits prior to the
start of construction, including approval under the Direct
Endorsement process described in Sec. 203.5 of this
chapter, or under the Lender Insurance process described in
Sec. 203.6 of this chapter;
(ii) Approved for insurance or other benefits based upon
participation in an insured warranty program; or
(iii) Insured as new construction based upon a Certificate
of Reasonable Value issued by the Department of Veterans
Affairs.
(b) Conflicting standards.
The standards listed in this subpart requirements contained
in Sec. 200.926d do not preempt local or State standards,
nor do they alter or affect a builder's obligation to comply
with any local or State requirements. However, a property
shall be eligible for benefits only if it complies with the
requirements of this subpart, including any referenced the
listed standards, except when such requirements conflict
with local or State requirements, in which case the stricter
requirements shall apply. When any of the requirements
identified in Sec. 200.926c 200.926b are in conflict with a
partially accepted local or state code, the conflict will be
resolved by the HUD Field Office servicing the jurisdiction
in which the property is to be located.
(c) Standard for Evaluating Local or State Building Codes.
The Secretary shall compare a local building code
submitted under paragraph (d) of this section or a State
code to the list of construction related areas contained in
Sec. 200.926a.
(1) A local or State code will be accepted if it regulates
each area and subarea on the list.
(2) A State or local building code will be partially accepted
if it regulates most of the areas on the list. However, no
code may be partially accepted if it fails to regulate the
subarea for seismic design (see Sec. 200.926a(c)(5)), or if
it fails to regulate subareas in more than one of the
following major areas listed in Sec. 200.926a: fire safety,
light and ventilation, structural loads and seismic design,
foundation systems, materials standards, construction
components, glass, mechanical, plumbing, and electrical.
(3) For purposes of this paragraph, a local or State code
regulates an area or subarea if it establishes a standard
concerning that area or subarea. However, for earthquake
loads (see Sec. 200.926a(c)(5)), ASCE 7-88 is mandatory.
(d) Code Selection.
Any materials required to be submitted under this section
must be submitted by the time the lender or other interested
party applies for mortgage insurance or other benefits.
(1) Jurisdictions without previously accepted building
codes. The following submission requirements apply to
lenders and other interested parties in jurisdictions without
building codes, jurisdictions with building codes which
have never been submitted for acceptance, and jurisdictions
with building codes which previously have been submitted
for acceptance and have not been accepted or partially
accepted by the Secretary.
(i) In jurisdictions without local building codes: (A) If the
State building code is acceptable, the lender or other
interested party must comply with the State building code
and the requirements of Sec. 200.926d; (B) If the State
building code is partially acceptable, the lender or other
interested party must comply with:(1) The acceptable
portions of the partially acceptable code; and (2) Those
portions of the CABO One and Two Family Dwelling
Code designated by the HUD Field Office in accordance
with Sec. 200.926c; and (3) The requirements of Sec.
200.926d.(C) If there is no State building code or if the
State building code is unacceptable, the lender or other
interested party must comply with: (1) The CABO One and
Two Family Dwelling Code as identified in Sec.
200.926b(a); and (2) The requirements of Sec. 200.926d.
(ii) In jurisdictions with local building codes which have
never been submitted for review, lenders or other interested
parties must: (A) Comply with the requirements of
paragraph (d)(1)(i) (A), (B) or (C) of this section, as
appropriate; or (B) Request the Secretary's acceptance of
the local building code in accordance with paragraph
(d)(1)(iv) of this section.
(1) If the Secretary determines that the local building code
is unacceptable, then the lender or other interested party
must comply with the requirements of paragraph (d)(1)(i)

35
(A), (B) or (C) of this section as appropriate.
(2) If the Secretary determines that the local code is
partially acceptable, then the lender or other interested
party must comply with:
(i) The acceptable portions of the partially acceptable local
code; and
(ii) Those portions of the CABO One and Two Family
Dwelling Code designated by the HUD Field Office in
accordance with Sec. 200.926c; and
(iii) The requirements of Sec. 200.926d.
(3) If the Secretary determines that the local code is
acceptable, then the lender or other interested party must
comply with the local building code and the requirements
of Sec. 200.926d.
(iii) In jurisdictions with local building codes which
previously have been submitted for review and which have
been found unacceptable by the Secretary: (A) If the local
code has not been changed since the date the code or
changes thereto were submitted to the Secretary, the lender
or other interested party must comply with the
requirements of paragraph (d)(1)(i) (A), (B) or (C) of this
section, as appropriate; or (B) If the local code has been
changed since the date when the code or changes thereto
were submitted to the Secretary, the lender or other
interested party must submit a copy of all changes to the
local building code, including all applicable service codes
and appendices and a copy of the statute, ordinance,
regulation or order making such changes in the code, which
have been made since the date when the code or other
changes thereto were last submitted to the Secretary.
However, the lender or other interested party need not
submit any part already in the possession of the HUD Field
Office. Based upon the Secretary's determination
concerning the acceptability of the local code as changed,
the lender or other interested party must comply with the
requirements of paragraph (d)(1)(ii)(B) (1), (2) or (3) of
this section, as appropriate.
(iv) In order to obtain the Department's approval of a local
code, the lender or other interested party must submit the
following material to the HUD Field Office serving the
jurisdiction in which the property is to be constructed: (A)
A copy of the jurisdiction's local building code, including
all applicable service codes and appendices; and (B) A
copy of the statute, ordinance, regulation, or order
establishing the code, if such statute, ordinance, regulation
or order is not contained in the building code itself.
However, the lender or other interested party need not
submit any document already on file in the HUD Field
Office.
(2) Jurisdictions with previously accepted or partially
accepted building codes. The following submission
requirements apply to lenders or other interested parties in
any jurisdiction with a building code which has been
accepted or partially accepted by the Secretary:
(i) The lender or other interested party shall submit to the
HUD Field Office serving the jurisdiction in which the
property is to be constructed: (A) A certificate stating that,
since the date when the code or any changes thereto were
last submitted to the Secretary, the jurisdiction's local
building code has not been changed; or (B)(1) A copy of all
changes to the jurisdiction's building code, including all
applicable service codes and appendices, which have been
made since the date when the code or other changes thereto
were last submitted to the Secretary. However, the lender
or other interested party need not submit any part already
in the possession of the HUD Field Office; and (2) A copy
of the statute, ordinance, regulation, or order making such
changes in the code.
(ii) If, based upon changes to the local building code, the
Secretary determines that it is unacceptable, the lender or
other interested party must comply with the requirements
of paragraph (d)(1) (i)(A), (B) or (C) of this section, as
appropriate.
(iii) If the local building code was previously found by the
Secretary to be partially acceptable and there have been no
changes to it or if the local building code was previously
found by the Secretary to be partially acceptable and if,
based upon changes to it, the Secretary determines that it is
still partially acceptable or if the local building code was
previously found by the Secretary to be acceptable and if,
based upon changes to it, the Secretary determines that it is
partially acceptable, then the lender or other interested
party must comply with paragraphs (d)(1)(ii)(B)(2) (i), (ii)
and (iii) of this section.
(iv) If the local building code was previously found by the
Secretary to be partially acceptable and if, based upon
changes to it, the Secretary determines that it is acceptable,
or if the local building code was previously found by the
Secretary to be acceptable and there have been no changes
to the code, or if the local building code was previously
found by the Secretary to be acceptable and if, based upon
changes to it, the Secretary determines that it is still
acceptable, then the lender or other interested party must
comply with the local building code and the requirements
of Sec. 200.926d.
(3) Notification of decision. (i) Fire retardant treated
plywood, where approved by a State or local building code,
shall not be permitted for use in roof construction unless a
HUD technical suitability bulletin has been issued by the
Department for that product.
(ii) The Secretary shall review the material submitted under
Sec. 200.926(d). Following that review, the Secretary shall
issue a written notice (except where there is a previously
accepted or partially accepted code which has not been
changed) to the submitting party stating whether the local
building code is acceptable, partially acceptable, or not
acceptable. Where the local building code is not
acceptable, the notice shall also state whether the State
code is acceptable, partially acceptable or not acceptable.
The notice shall also contain the basis for the Secretary's
decision and a notification of the submitting party's right to
present its views concerning the denial of acceptance if the
code is neither accepted nor partially accepted. The
Secretary may, in his or her discretion, permit either an oral
or written presentation of views.
(4) Department's responsibilities. (i) Each Regional and

36
Field Office will maintain a current list of jurisdictions
with accepted local or State building codes, a current list of
jurisdictions with partially accepted local or State building
codes and a current list of jurisdictions with local or State
building codes which have not been accepted. For local
codes, the lists will state the most recent date when the
code or changes thereto were submitted to the Secretary.
The lists, which shall be prepared by the Field Offices and
submitted to the Regional Offices, will be available to any
interested party upon request. In addition, the list of
jurisdictions whose codes have been partially accepted
shall identify in accordance with Sec. 200.926c those
portions of the codes listed at Sec. 200.926b(a) with which
the property must comply.
(ii) The Department is responsible for obtaining copies of
the State codes and any changes thereto.
Sec. 200.926a Residential Building Code Comparison
Items
HUD will review each local and State code submitted
under this subpart to determine whether it regulates all of
the following areas and subareas:
(a) Fire Safety. (1) Allowable height; (2) Fire separations;
(3) Fire resistance requirements; (4) Egress doors and
windows; (5) Unit smoke detectors; (6) Flame spread.
(b) Light and Ventilation. (1) Habitable rooms; (2) Bath
and toilet rooms.
(c) Structural Loads and Seismic Design. (1) Design live
loads; (2) Design dead loads; (3) Snow loads (for
jurisdictions with snow loading conditions identified in
Section 7 of ASCE-7-88 (formerly ANSI A58.1-82);
(4) Wind loads; (5) Earthquake loads (for jurisdictions in
seismic zones 3 or 4, as identified in Section 9 of
ASCE-7-88 (formerly ANSI A58.1-82)).
(d) Foundation Systems. (1) Foundation depths;
(2) Footings; (3) Foundation materials criteria.
(e) Materials Standards. (1) Materials standards.
(f) Construction Components. (1) Steel; (2) Masonry;
(3) Concrete; (4) Lumber; (5) Roof construction and
covering; (6) Chimneys and fireplaces.
(g) Glass. (1) Thickness/area requirements; (2) Safety
glazing.
(h) Mechanical. (1) Heating, cooling and ventilation
systems; (2) Gas, liquid and solid fuel piping and
equipment; (3) Chimneys and vents; (4) Ventilation (air
changes).
(i) Plumbing. (1) Materials standards; (2) Sizing and
installing drainage systems; (3) Vents and venting; (4)
Traps; (5) Cleanouts; (6) Plumbing fixtures; (7) Water
supply and distribution; (8) Sewage disposal systems.
(j) Electrical. (1) Branch circuits; (2) Services; (3)
Grounding; (4) Wiring methods; (5) Cable; (6) Conduit; (7)
Outlets, switches and junction boxes; (8) Panelboards.
Sec. 200.926b Model Codes
(a) Incorporation by Reference.
The following model code publications are incorporated by
reference in accordance with 5 U.S.C. 552(a) and 1 CFR
part 51. The incorporation by reference of these
publications has been approved by the Director of the
Federal Register. The locations where copies of these
publications are available are set forth below.
(1) CABO One and Two Family Dwelling Code, 1992
Edition, including the 1993 amendments, but excluding
Chapter I--Administrative, and the phrase “or approved fire
retardant wood'” contained in the exception of paragraph
R-218.2.2(2), but including the Appendices A, B, D, and E
of the Code. (Available from the Council of American
Building Officials, Suite 708, 5203 Leesburg Pike, Falls
Church, VA 22041.)
(2) Electrical Code for One and Two Family Dwellings,
NFPA 70A, 1990, including Tables and Examples.
Available from the National Fire Protection Association,
Batterymarch Park, Quincy, MA 02269.
(b) Model code compliance requirements.
(1) When a one or two family dwelling is to comply with
the model codes set forth in Sec. 200.926b(a), the
following requirements of those model codes shall not
apply to those properties:
(i) Those provisions of the model codes that establish
energy requirements for one and two family dwellings; and
(ii) Those provisions of the model codes that require or
allow the issuance of permits of any sort.
(2) Where the model codes set forth in paragraph (a) of this
section designate a building, fire, mechanical, plumbing or
other official, the Secretary's designee in the HUD Field
Office serving the jurisdiction in which the dwelling is to
be constructed shall act as such official.
(c) Designation of Model Codes.
When a one or two family dwelling or townhouse is to
comply with portions of the model code or the entire model
code, the dwelling shall comply with the CABO One and
Two Family Dwelling Code 1992 Edition, including the
1993 amendments, or portion thereof as modified by Sec.
200.926e of this part and designated by the HUD Field
Office serving a jurisdiction in which a property is located.
In addition, the property shall comply with all of the
standards which are referenced for any designated portions
of the model code, and with the Electrical Code for One
and Two Family Dwellings, NFPA 70A/1990.
Sec. 200.926c Model Code Provisions for Use in
Partially Accepted Code Jurisdictions
If a lender or other interested party is notified that a State
or local building code has been partially accepted, then the
properties eligible for HUD benefits in that jurisdiction
shall be constructed in accordance with the applicable State
or local building code, plus those additional requirements
identified below. Depending upon the major area identified

37
in Sec. 200.926a which is not adequately regulated by the
State or local code, the HUD Field Office will designate, in
accordance with the schedule below, those portions of one
of the model codes with which the property must comply.
Schedule for Model Code Supplements to Local or State
Codes
------------------------------------------------------------------------
Deficient major from Portions of the CABO One and
Sec.200.926a as Two Family Dwelling Code,
determined by 1982 Edition incl. 1993 amend-
Field Office Review ments with which a property
must comply and Electrical
Code
for One and Two Family Dweli-
ings (NFPA 70A-1990)
------------------------------------------------------------------------
(a) Fire safety ............ Chapters 2, 9; Section R-402
(b) Light and ventilation .......Chapter 2; Section R-309
(c) Structural loads and seismic design ....... Chapter 2
(d) Foundation systems ................... Chapter 3
(e) Materials standards ................... Chapter 26
(f) Construction components ................. Part III
(g) Glass ............................... Chapter 2
(h) Mechanical ............................ Part IV
(i) Plumbing ............................... Part V
(j) Electrical ..................... (NFPA 70A-1990)
Sec. 200.926d Construction Requirements
(a) Application
(1) General. These standards cover the agency
requirements for accessibility to physically handicapped
people, variations to standards, real estate entity, trespass
and utilities, site conditions, access, site design, streets,
dedication of utilities, drainage and flood hazard exposure,
special construction and product acceptance, thermal
requirements, and water supply systems.
2) Requirements for accessibility to physically
handicapped people. The HUD Field Office will advise
project sponsors as to the extent accessibility will be
required for new construction of one- and two-family
dwellings on a project-by-project basis.
(i) Technical standards. See HUD Handbook, 4910.1,
Sections 100-1.3b and 100-1.3c.
[NOTE: SECTIONS 100-13.b AND 100-1.3c DO NOT
EXIST IN THE ON-LINE VERSION OF 4910.1. IN
THE PRINTED VERSION, THE WORDING IS “See
24 CFR Part 40.” PART 40 REFERENCES THE
UNIFORM FEDERAL ACCESSIBILITY
STANDARDS (UFAS). ]
(3) Variations to standards.
(i) New materials and technologies. See paragraph (d) of
this section. Alternatives, nonconventional or innovative
methods and materials shall be equivalent to these
standards in the areas of structural soundness, durability,
economy of maintenance or operation and usability.
(ii) Variation procedures. Variations from the requirements
of any standard with which the Department requires
compliance shall be made in the following ways: (A) For a
particular design or construction method to be used on a
single case or project, the decision is the responsibility of
the Field Office. Headquarters concurrence is not required.
(B) Where a variation is intended to be on a repetitive
basis, a recommendation for a Local Acceptable Standard,
substantiating data, and background information shall be
submitted by the Field Office to the Director, Office of
Manufactured Housing and Regulatory Functions.
(iii) Variances which require individual analysis and
decision in each instance are not considered as repetitive
variances even though one particular standard is repeatedly
the subject of variation. Such variances are covered by
paragraph (a)(3)(ii)(A) of this section.
(b) General Acceptability Criteria
(1) Real estate entity. The property shall comprise a single
plot except that a primary plot with a secondary plot for an
appurtenant garage or for other use contributing to the
marketability of the property will be acceptable provided
the two plots are in such proximity as to comprise a readily
marketable real estate entity.
(2) Service and facilities
(i) Trespass. Each living unit shall be one that can be used
and maintained individually without trespass upon
adjoining properties, except when the windowless wall of a
detached dwelling is located on a side lot line. A detached
dwelling may be located on a side lot line if: (A) legal
provision is made for permanent access for the
maintenance of the exterior portion of the lot line wall, and
(B) the minimum distances from the dwelling to the
dwellings on the abutting properties are not less than the
sum of the side yard distances computed as appropriate for
the type of opposing walls (minimum distance 10 ft).
(ii) Utilities. Utility services shall be independent for each
living unit, except that common services such as water,
sewer, gas and electricity may be provided for living units
under a single mortgage or ownership. Separate utility
service shut-off for each unit shall be provided. For living
units under separate ownership, common utility services
may be provided from the main to the building line when
protected by an easement or convenient and maintenance
agreement acceptable to HUD, but shall not pass over,
under or through any other living unit. Individual utilities
serving a living unit may not pass over, under or through
another living unit under the same mortgage unless
provision is made for repair and maintenance of utilities
without trespass or when protected by an easement or
covenant providing permanent access for maintenance and
repair of the utilities. Building drain cleanouts shall be
accessible from the exterior where a single drain line
within the building serves more than one unit.
(3) Site conditions.
(i) The property shall be free of those foreseeable hazards
and adverse conditions which may affect the health and
safety of occupants or the structural soundness of the
improvements, or which may impair the customary use and

38
enjoyment of the property. The hazards include toxic
chemicals, radioactive materials, other pollution, hazardous
activities, potential damage from soil or other differential
ground movements, ground water, inadequate surface
drainage, flood, erosion, or other hazards located on or off
site. The site must meet the standards set forth in 24 CFR
part 51, and HUD Handbook 4910.1, section 606 for
termite and decay protection.
[NOTE: 24 CFR PART 51 CONCERNS HOUSING IN
HIGH-NOISE ENVIRONMENTS, SUCH AS NEAR
AIRCRAFT RUNWAYS, AND IN AREAS
CONTAINING HAZARDOUS SUBSTANCES; THESE
SUBJECTS ARE ALSO ADDRESSED IN FORM
HUD-92541. SECTION 606 OF 4910.1 REFERENCES
USDA HOME AND GARDEN BULLETIN NO. 73-
1986, AN OUT-OF-PRINT PUBLICATION.]
(ii) When special conditions exist or arise during
construction which were unforeseen and which
necessitate precautionary or hazard mitigation
measures, the HUD Field Office shall require
corrective work to mitigate potential adverse effects
from the special conditions as necessary. Special
conditions include rock formations, unstable soils or
slopes, high ground water levels, springs, or other
conditions which may adversely affect a property. It
shall be the builder's responsibility to ensure proper
design, construction and satisfactory performance
where these conditions are present.
(4) Access.
(i) Each property shall be provided with vehicular or
pedestrian access by a public or private street. Private
streets shall be protected by permanent easement.
(ii) Each living unit shall have a means of access such
that it is unnecessary to pass through any other living
unit.
(iii) The rear yard shall be accessible without passing
through any other living unit.
(iv) For a townhouse type dwelling, access to the rear
yard may be by means of alley, easement, passage
through the dwelling, or other means acceptable to
the HUD Field Office.
(c) Site Design
(1) General.
(i) A site design shall be provided which includes an
arrangement of all site facilities necessary to create a
safe, functional, healthful, durable and energy
efficient living environment.
(ii) With the exception of paragraph (c)(4) of this
section, these site design standards apply only in
communities that have not adopted criteria for site
development applicable to one and two family
dwellings.
(iii) Single family detached houses situated on
individual lots located on existing streets with utilities
need not comply with the requirements of paragraphs
(c)(2) and (c)(3) of this section.
(2) Streets.
(i) Existing or proposed streets on the site shall
connect to private or public streets and shall provide
all-weather access to all buildings for essential and
emergency use, including access needed for
deliveries, service, maintenance and fire equipment.
(ii) Streets shall be designed for dedication for public
use and maintenance or, when approved by the HUD
Field Office, may be retained as private streets where
protected by permanent easements.
(3) Dedication. Utilities shall be located to permit
dedication to the local government or appropriate
public body.
(4) Drainage and flood hazard exposure
(i) Residential structures with basements located in
FEMA-designated areas of special flood hazard. The
elevation of the lowest floor in structures with
basements shall be at or above the base flood level
(100-year flood level) required for new construction
or substantial improvement of residential structures
under regulations for the National Flood Insurance
Program (NFIP) (see 44 CFR 60.3 through 60.6),
except where variances from this standard are granted
by communities under the procedures of the Federal
Emergency Management Agency (FEMA) at 44 CFR
60.6(a) or exceptions from this NFIP standard for
basements are approved by FEMA in accordance
with procedures at 44 CFR 60.6(c).
(ii) Residential structures without basements located
in FEMA-designated areas of special flood hazard.
The elevation of the lowest floor in structures without
basements shall be at or above the FEMA-designated
base flood elevation (100-year flood level).
(iii) Residential structures located in
FEMA-designated “coastal high hazard areas.” (A)
Basements or any permanent enclosure of space
below the lowest floor of a structure are prohibited.
(B) Where FEMA has determined the base flood
level without establishing stillwater elevations, the
bottom of the lowest structural member of the lowest
floor (excluding pilings and columns) and its
horizontal supports shall be at or above the base flood
level.
(iv) (A) In all cases in which a Direct Endorsement
(DE) mortgagee or a Lender Insurance (LI)
mortgagee seek to insure a mortgage on a newly
constructed one-to four-family dwelling (including a
newly erected manufactured home) that was

39
processed by the DE or LI mortgagee, the DE or LI
mortgagee must determine whether the property
improvements (dwelling and related
structures/equipment essential to the value of the
property and subject to flood damage) are located in a
100-year floodplain, as designated on maps of the
Federal Emergency Management Agency. If so, the
DE mortgagee, before submitting the application for
insurance to HUD, or the LI mortgagee, before
submitting all the required data regarding the
mortgage to HUD, must obtain: (1) A final Letter of
Map Amendment (LOMA); (2) A final Letter of Map
Revision (LOMR); or (3) A signed Elevation
Certificate documenting that the lowest floor
(including basement) of the property improvements is
built at or above the 100-year flood elevation in
compliance with National Flood Insurance program
criteria 44 CFR 60.3 through 60.6. (B) Under the DE
program, these mortgages are not eligible for
insurance unless the DE mortgagee submits the
LOMA, LOMR, or Elevation Certificate to HUD
with the mortgagee's request for endorsement.
(v) Streets. Streets must be usable during runoff
equivalent to a 10-year return frequency. Where
drainage outfall is inadequate to prevent runoff
equivalent to a 10-year return frequency from
ponding over 6 inches deep, streets must be made
passable for commonly used emergency vehicles
during runoff equivalent to a 25-year return
frequency, except where an alternative access street
not subject to such ponding is available.
(vi) Crawl spaces. Crawl spaces must not pond water
or be subject to prolonged dampness.
(d) Special Construction and Product Acceptance.
[NOTE: PARAGRAPHS 1 AND 2 BELOW
REFER TO THE TSP PROGRAM]
(1) Structural features of factory produced (modular
or panelized) housing or components.
(i) For factory fabricated systems or components,
HUD Handbook 4950.1, ``Technical Suitability of
Products Program Technical and Processing
Procedures'' shall apply.
(ii) The requirements of this part shall apply to
structural features, consisting of factory fabricated
systems or components assembled either at the
factory or at the construction site, if the total
construction is covered by these standards and can
be inspected on-site for determination of compliance.
(2) Non-structural or non-standard features. These
features include methods of construction, systems,
sub-systems, components, materials and processes
which are not covered by these requirements. See
HUD Handbook 4950.1 for procedures to be
followed in order to obtain acceptance of
non-structural components or materials. See HUD
Handbook 4910.1, appendix F for a list of Use of
Materials Bulletins. Products and methods shall
conform to the appropriate Use of Materials Bulletin.
(3) Standard Features. These features include
methods of construction, systems, sub-systems,
components, materials and processes which are
covered by national society or industry standards. For
a list of standards and practices to which compliance
is required, see HUD Handbook 4910.1, Appendix C
and Appendices E and F, available from HUD, 451
Seventh Street, SW., Attention: Mailroom B-133,
Washington, DC 20410.
(e) Energy efficiency.
All detached one- and two-family dwellings and
one-family townhouses not more than three stories in
height shall comply with the CABO Model Energy
Code, 1992 Edition, Residential Buildings, except for
Sections 101.3.1, 101.3.2, 104, and 105, but Section
101.3.2.2, Historic Buildings, shall remain, and
including the Appendix, and HUD intermediate MPS
Supplement 4930.2 Solar Heating and Domestic Hot
Water Systems, 1989 edition.
[NOTE: 4930.2 IS NOT IN PRINT]
(f) Water Supply Systems
(1) General.
(i) Each living unit shall be provided with a
continuing and sufficient supply of safe water under
adequate pressure and of appropriate quality for all
household uses. Newly constructed residential
property for which a building permit has been applied
for on or after June 19, 1988 from the competent
authority with jurisdiction in this matter shall have
lead-free water piping. For purposes of these
standards, water piping is “lead free” if it uses solders
and flux containing not more than 0.2 percent lead
and pipes and pipe fittings containing not more than
8.0 percent lead. This system shall not impair the
function or durability of the plumbing system or
attachments.
(ii) The chemical and bacteriological standards of the
local health authority shall apply. In the absence of
such standards, those of the appropriate State agency
shall apply. A water analysis may be required by
either the health authority or the HUD Field Office.
(iii) Whenever feasible, connection shall be made to a
public water system. When a public system is not
available, connection shall be made to a community
system which complies with HUD Handbook 4940.2,
if feasible.

40
[NOTE: HANDBOOK 4940.2, MINIMUM
DESIGHN STANDARDS FOR COMMUNITY
WATER SUPPLY SYSTEMS, IS NOT IN PRINT]
(2) Individual water systems.
(i) The system should be capable of delivering a flow
of 5 gpm over at least a 4 hour period.
(ii) The chemical and bacteriological standards of the
local health authority shall apply. In the absence of
such standards, those of the appropriate State agency
shall apply. A water analysis may be required by
either the health authority or the HUD Field Office.
(iii) After installation, the system shall be disinfected
in accordance with the recommendations or
requirements of the local health authority. In the
absence of a health authority, system cleaning and
disinfection shall conform to the current EPA Manual
of Individual Water Supply Systems.
[NOTE: THE PROPER TITLE IS MANUAL OF
INDIVIDUAL AND PRIVATE WATER SUPPLY
SYSTEMS. IT IS NOT IN PRINT]
(iv) Bacteriological or chemical examination of a
water sample collected by a representative of the
local or state health authority shall be made when
required by that authority or the HUD Field Office.
(3) Location of wells.
(i) A well located within the foundation walls of a
dwelling is not acceptable except in arctic or
subarctic regions.
(ii) Water which comes from any soil formation
which may be polluted, contaminated, fissured,
creviced or less than 20 ft. below the natural ground
surface is not acceptable, unless acceptable to the
local health authority.
(iii) Individual water supply systems are not
acceptable for individual lots in areas where chemical
soil poisoning has been or is practiced if the
overburden of soil between the ground surface and
the water bearing strata is coarse grained sand,
gravel, or porous rock, or is creviced in a manner
which will permit the recharge water to carry the
toxicants into the zone of saturation.
(iv) The following table shall be used in establishing
the minimum acceptable distances between wells and
sources of pollution located on either the same or
adjoining lots. These distances may be increased by
either the health authority having jurisdiction or the
HUD Field Office.
Distance From Source of Pollution
-----------------------------------------------------------------
-
Source of Pollution Minimum
horizontal
distance
(feet)
-----------------------------------------------------------------
-
Property Line ............................ 10
Septic Tank.............................. 50
Absorption Field [1]...................... 100
Seepage Pit [1] .......................... 100
Absorption Bed [1]....................... 100
Sewer Lines w/Permanent Watertight Joints .... 10
Other Sewer Lines ........................ 50
Chemically Poisoned Soil [3]................ 25
Dry Well................................ 50
Other [2]
-----------------------------------------------------------------
-
[1] This clearance may be increased or
decreased depending upon soil and rock
penetrated by the well and aquifer
conditions. The clearance may be increased
in creviced limestone and permeable strata
of gravel and sand. The clearance may be
reduced to 50 ft. only where the ground
surface is effectively separated from the
water bearing formation by an extensive,
continuous and impervious strata of clay,
hardpan, or rock. The well shall be
constructed so as to prevent the entrance of
surface water and contaminants.
[2] The recommendations or requirements of
the local health authority shall apply.
[3] This clearance may be reduced to 15 feet
only where the ground surface is effectively
separated from the water bearing formation
by an extensive, continuous and impervious
strata of clay, hardpan, or rock.
(4) Well construction.
(i) The well shall be constructed so as to allow the
pump to be easily placed and to function properly.
(ii) (A) All drilled wells shall be provided with a
sound, durable and watertight casing capable of
sustaining the loads imposed. (B) The casing shall
extend from a point several feet below the water level
at drawdown or from an impervious strata above the
water level to 12 in. above either the ground surface
or the pump room floor. The casing shall be sealed at
the upper opening to a depth of at least 15 feet.
(iii) Bored wells shall be lined with concrete, vitrified
clay or equivalent materials.

41
(iv) The space between the casing or liner and the
wall of the well hole shall be sealed with cement
grout.
(v) The well casing shall not be used to convey water
except under positive pressure. A separate drop pipe
shall be used for the suction line.
(vi) When sand or silt is encountered in the
water-bearing formation, the well shall either be
compacted and gravel packed, or a removable strainer
or screen shall be installed.
(vii) The surface of the ground above and around the
well shall be compacted and graded to drain surface
water away from the well.
(viii) Openings in the casing, cap, or concrete cover
for the entrance of pipes, pumps or manholes shall be
watertight.
(ix) If a breather is provided, it shall extend above the
highest level to which surface water may rise. The
breather shall be watertight, and the open end shall be
screened and positioned to prevent entry of dust,
insects and foreign objects.
(5) Pump and equipment.
(i) Pumps shall be capable of delivering the volume
of water required under normal operating pressure
within the living unit. Pump capacity shall not exceed
the output of the well.
(ii) Pumps and equipment shall be mounted to be free
of objectionable noises, vibrations, flooding,
pollution, and freezing.
(iii) Suction lines shall terminate below maximum
drawdown of the water level in the well.
(iv) Horizontal segments of suction line shall be
placed below the frost line in a sealed casing pipe or
in at least 4 in. of concrete. The distance from suction
line to sources of pollution shall be not less than
shown in the table at paragraph (f)(3)(iv) of this
section.
(6) Storage tanks.
(i) A pressure tank having a minimum capacity of 42
gallons shall be provided. However, prepressured
tanks and other pressurizing devices are acceptable
provided that delivery between pump cycles equals or
exceeds that of a 42 gallon tank.
(ii) Tanks shall be equipped with a clean-out plug at
the lowest point, and a suitable pressure relief valve.
Sec. 2009.926e Supplemental Information for Use
with CABO One and Two Family Dwelling Code
The following shall be used in Table No. R-202,
Climatic and Geographic Design Criteria of the
CABO One and Two Family Dwelling Code.
(a) Roof live loads.
Roof slope 3 in 12 or less: 20 psf; roof slope over 3 in
12: 15 psf; roof used as deck: 40 psf
(b) Roof snow load.
The roof snow load shall be in accordance with
section 7 of ASCE 7-88.
(c) Wind pressures.
The minimum Design Wind Pressures (net pressures)
set forth below apply to areas designated as
experiencing basic wind speeds up to and including
80 mph, as shown in ASCE 7-88, Figure 1, Basic
Wind Speed Map. These pressures also apply to
buildings not over 30 ft. in height above finish grade,
assuming exposure C or defined in ASCE 7-88.
(1) Minimum design wind pressure criteria.
(i) Buildings (for overturning racking or sliding);
p=20 psf.
(ii) Chimneys, p=30 psf.
(iii) Exterior walls, p=15 psf inward or outward.
Local pressure at corners of walls shall be not less
than p=30 psf outward. These local pressures shall
not be included with the design pressure when
computing overall loads. The pressures shall be
applied perpendicularly outward on strips of width
equal to 10 percent of the least width of building.
(iv) Partitions, p=10 psf.
(v) Windows, p=20 psf inward or outward.
(vi) Roof, p=20 psf inward or outward. Roofs with
slopes greater than 6 in 12 shall be designed to
withstand pressures acting inward normal to the
surface, equal to the design wind pressure for exterior
walls. Overhanging eaves, cornices, and ridges, 40
psf upward normal to roof surface. These local
pressures shall not be included with the design
pressure when computing overall loads. The
pressures shall be applied perpendicularly outward on
strips of width equal to 10 percent of the least width
of building. Net uplift on horizontal projection of roof
shall not be less than 12 psf.
(2) Severe wind design pressures. If the construction
is higher than 30 ft., or if it is located in an area
experiencing wind speeds greater than 80 mph, higher
design wind pressures than shown above are required.
Use Section 6 of ASCE 7-88 for higher criteria and
for determining where wind speeds greater than 80
mph occur. Pressures are assumed to act horizontally

42
on the gross area of the vertical projection of the
structure except as noted for roof design.
(d) Seismic conditions shall be in accordance with
Section 9 of ASCE 7-88.
(e) Subject to damage from weathering.
A jurisdiction's weathering region shall be as
established by the map in ASTM C 62-83.
(f) Subject to damage from frost line depth.
Exterior wall footings or foundation walls including
those of accessory buildings shall extend a minimum
of 6 in. below the finished grade and, where
applicable, the prevailing frost line.
(g) Subject to damage from termites.
``Yes'' shall be used in locations designated as
Regions I, II or III. ``No'' shall be used in locations
designated as Region IV. The map for Termite
Infestation Probability in appendix A of CABO, One
and Two Family Dwelling Code shall be used to
determine the jurisdiction's region.
(h) Subject to damage from: decay.
“Yes” shall be used in locations designated as
moderate to severe and slight to moderate. “No” shall
be used in locations designated as none to slight. The
Decay Probability map in appendix A of CABO, One
and Two Family Dwelling Code, shall be used to
determine the jurisdiction's decay designation.

43
Appendix D
MORTGAGEE LETTER 2001-27
U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, D.C. 20410-0001
October 23, 2001
MORTGAGEE LETTER 2001- 27
TO: ALL APPROVED MORTGAGEES
SUBJECT: Pre-approval Requirements for New Construction and an Alternative to the Inspection
Requirements - Single Family Loan Production
This Mortgagee Letter announces that the Department is expanding the definition of
“Pre-approval” to satisfy the requirements for obtaining a high ratio loan on construction which is one
year old or less and allowing an alternative to the inspection requirements. The definition of pre-approval
is now expanded to include the issuance of a building permit by a local jurisdiction prior to construction
as acceptable evidence of “pre-approval.” In those jurisdictions that perform the local inspections and
issue Certificates of Occupancy (or equivalent), this certificate is evidence of the local inspections.
Finally, FHA will no longer “approve” local jurisdictions to perform these inspections since the
Certificate of Occupancy (or equivalent) will be accepted as verification of these inspections. These
changes are effective for case numbers ordered on or after the date of this Mortgagee Letter.
I. Background
In accordance with the National Housing Act, a property one year old OR less must be “Pre-approved”
OR be covered by a warranty plan acceptable to the Secretary to be eligible for a high-ratio insured
mortgage, defined as exceeding 90% loan to value (LTV). An Early Start Letter issued by the lender
before construction starts has long been considered “Pre-approved” and satisfactory evidence for
eligibility for high LTV financing. (See HUD Handbook 4145.1 REV-2, Appendix 6.). Three
inspections are required if the property is “pre-approved”.
Mortgagee Letter 96-18 stated that in those jurisdictions that FHA has determined provide adequate code
enforcement and inspection services, the first two inspections may be performed by the local jurisdiction,
but the third inspection must be performed by an FHA fee panel inspector. Mortgagee Letter 97-22, took
this a step further by announcing that the Department permits the final inspection by the local authority to
be accepted in lieu of FHA's third inspection in those jurisdictions where FHA accepts the first two
inspections by the local authority.
II. Expanded Definition of Pre-approval, an Alternate to Local Inspections and FHA's Approval of Local
Jurisdictions to End
Because the Department allows the local jurisdictions to perform the inspections as mentioned above, we
are accepting a Certificate of Occupancy as evidence of these local inspections. Additionally, if a local
jurisdiction issues a building permit (or its equivalent), prior to construction, the Department will accept
that as evidence of “Pre-approval”. Thus, in such cases where both a building permit and a certificate of

44
occupancy are issued by a local jurisdiction, neither an Early Start Letter nor a HUD approved 10-year
warranty plan is required. This new definition of Pre-approval does not apply to condominiums or to
manufactured housing due to special requirements applicable to these housing types.
The Department will no longer approve local jurisdictions that perform inspections acceptable to FHA.
Now, when a builder uses local jurisdictions to perform inspections, a copy of the Certificate of
Occupancy (or its equivalent) is considered to be evidence of the local jurisdiction inspections. Form
HUD 92900-A, page 3, “Direct Endorsement Approval for a HUD/FHA Insured Mortgage”, has been
revised to include a check box for the lender to certify that the property is 100% complete (both on site
and off site improvements) and that the property meets HUD's Minimum Property Standards". This form
can be downloaded via HUDCLIPS at www.hudclips.org.
For those local jurisdictions that do not issue a Building Permit prior to construction (or its equivalent)
and a Certificate of Occupancy (or its equivalent), a property one year old or less must have an Early Start
Letter OR be covered by a warranty plan acceptable to the Secretary to be eligible for a high-ratio insured
mortgage. Regardless of the process used, the lender must certify by using Form HUD 92900-A, page 3,
that the property is 100% complete (both on site and off site improvements) and that the property meets
HUD's minimum property standards. This information collection is covered under the Office of
Management and Budget's (OMB) Control Number 2502-0059.
III. Documentation Requirements
In lieu of providing the Early Start Letter or proof of coverage by an acceptable warranty plan,
Mortgagees must include a copy of the building permit (or equivalent) and a copy of the Certificate of
Occupancy (or equivalent) in the endorsement binder. The alternative to local inspections described in
this letter does not eliminate the requirement for a one-year builder warranty as required by Section 801
of the National Housing Act. Mortgagees are reminded that in addition to the one-year builder's warranty
and Form HUD 92541, the Builder's Certification of Plans, Specifications and Site, they are still
responsible for obtaining all the applicable construction documents from the builder.
If you have any questions about this Mortgagee Letter, please contact your local Homeownership Center
in Atlanta (1-888-696-4687), Philadelphia (1-800-440-8647), Santa Ana (1-888-827-5605), or Denver
(1-800-543-9378).
Sincerely,
John C. Weicher
Assistant Secretary for Housing-Federal Housing Commissioner

45
Appendix E
FORM HUD-92541,
“BUILDERS CERTIFICATION OF PLANS, SPECIFICATIONS, AND SITE
http://www.hudclips.org/sub_nonhud/html/pdfforms/92541.pdf
(pages 45, 46, 47)

48
Appendix F
PARTS OF THE U.S. CODE CONTAINING THE PHRASE
“MINIMUM PROPERTY STANDARDS”
1) Parts of the U.S. Code containing the phrase
“minimum property standards” that are
applicable to the MPS:
12 USC 1701z-15. Approval of individual residential
water purification or treatment units
(a) In general: When the existing water supply does
not meet the minimum property standards
established by the Department of Housing and Urban
Development and a permanent alternative acceptable
water supply is not available, a continuous supply of
water may be provided through the use of approved
residential water treatment equipment or a water
purification unit that provides bacterially and
chemically safe drinking water.
[Origin: Pub. L 100-242 of 1988, title IV, Section 424]
Comment: The 1994 MPS (including Appendix K)
refers to HUD Handbook 4940.2, Minimum Design
Standards for Community Water Supply, but this
handbook is no longer published.
12 USC 1715k. Rehabilitation and neighborhood
conservation housing insurance
(d) Eligibility for insurance; conditions; limits. To be
eligible for insurance under this section a mortgage
shall meet the following conditions....(3)(B) (iii)....
And provided further, That the Secretary may further
increase any of the dollar amount limitations which
would otherwise apply for the purpose of this clause
by an amount not to exceed 20 per centum if such
increase is necessary to account for the increased cost
of the project due to the installation therein of a solar
energy system (as defined in subparagraph (3) of the
last paragraph of section 1703(a) of this title) or
residential energy conservation measures (as defined
in section 8211(11)(A) through (G) and (I) of title 42)
in cases where the Secretary determines that such
measures are in addition to those required under the
minimum property standards and will be
cost-effective over the life of the measure.
[Origin: Pub. L. 96-399 of 1980]
Comment: Increases allowable loan amounts for the
installation of solar systems and energy conservation
measures.
Note 1: Sec. 1703(a)(3) referenced above states: “the term
‘solar energy system’ means any addition, alteration, or
improvement to an existing or new structure which is
designed to utilize wind energy or solar energy either of the
active type based on mechanically forced energy transfer or
of the passive type based on convective, conductive, or
radiant energy transfer or some combination of these types
to reduce the energy requirements of that structure from
other energy sources, and which is in conformity with such
criteria and standards as shall be prescribed by the
Secretary in consultation with the Secretary of Energy.”
Note 2: Section 8211 of title 42 was added June 30, 1980
and deleted June 30, 1989.
12 USC 1715l. Housing for moderate income and
displaced families
(a) Purpose. This section is designed to assist private
industry in providing housing for low and moderate
income families and displaced families.
(k) Increase in maximum insurance amounts for costs
incurred from solar energy systems and energy
conservation measures. With respect to any project
insured under subsection (d)(3) or (d)(4) of this
section, the Secretary may further increase the dollar
amount limitations which would otherwise apply for
the purpose of those subsections by up to 20 per
centum if such increase is necessary to account for
the increased cost of the project due to the installation
therein of a solar energy system (as defined in
subparagraph (3) of the last paragraph of section
1703(a) of this title) o residential energy conservation
measures (as defined in section 8211(11)(A) through
(G) and (I) of title 42) in cases where the Secretary
determines that such measures are in addition to those
required under the minimum property standards
and will be cost-effective over the life of the measure.
[Origin: Pub. L.96-399 of 1980]
Comment: Increases allowable loan amounts for the
installation of solar systems and energy conservation
measures.
12 USC 1735f-4. Minimum property standards
(a) To the maximum extent feasible, the Secretary of
Housing and Urban Development shall promote the
use of energy saving techniques through minimum
property standards established by him for newly
constructed residential housing, other than
manufactured homes, subject to mortgages insured
under this chapter. Such standards shall establish

49
energy performance requirements that will achieve a
significant increase in the energy efficiency of new
construction. Such requirements shall be
implemented as soon as practicable after November
9, 1978. Following November 30, 1983, the energy
performance requirements developed and established
by the Secretary under this subsection for newly
constructed residential housing, other than
manufactured homes, shall be at least as effective in
performance as the energy performance requirements
incorporated in the minimum property standards
that were in effect under this subsection on
September 30, 1982.
[Origin: This subsection was added by Pub. L. 95-619 of
1978; it was amended by Pub. L. 98-181of 1983, which
designated the provision as subsection (a), inserted '', other
than manufactured homes,'' after ''housing'', inserted
provision that the energy performance requirements
developed for newly constructed residential housing, other
than manufactured homes, be at least as effective in
performance as the energy performance requirements
incorporated in the minimum property standards in effect
Sept. 30, 1982,and added subsection (b)]
Comment: Section (a) requires that energy
conservation measures for HUD-insured housing be
at least as stringent as those in force on September
30,1982. This applies to any energy conservation
requirements cited in MPS Appendix K.
(b) The Secretary may require that each property,
other than a manufactured home, subject to a
mortgage insured under this chapter shall, with
respect to health and safety, comply with one of the
nationally recognized model building codes, or with a
State or local building code based on one of the
nationally recognized model building codes or their
equivalent. The Secretary shall be responsible for
determining the comparability of the State and local
codes to such model codes and for selecting for
compliance purposes an appropriate nationally
recognized model building code where no such model
code has been duly adopted or where the Secretary
determines the adopted code is not comparable.
[Origin: Subsection (b) added by Pub. L. 98-181 of 1983]
Comment: Section (b) allows HUD to require that
HUD-insured housing comply with model or local
codes. This effectively allowed the elimination of the
MPS for One- and Two-Family Housing as it existed
prior to 1983.
Full amendment history:
1984 - Pub. L. 98-479 substituted ''minimum property
standards'' for ''Promotion of energy saving techniques by
Secretary of Housing and Urban Development of insured
housing'' in section catchline.
1983 - Subsec. (a). Pub. L. 98-181 designated existing
provision as subsec. (a), inserted '', other than
manufactured homes,'' after ''housing'', inserted provision
that the energy performance requirements developed for
newly constructed residential housing, other than
manufactured homes, be at least as effective in
performance as the energy performance requirements
incorporated in the minimum property standards in effect
Sept. 30, 1982, and added subsec. (b).
1980 - Pub. L. 96-399 struck out '', until such time as the
energy conservation performance standards required under
the Energy Conservation Standards for New Buildings Act
of 1976 become effective'' in second sentence.
1978 - Pub. L. 95-619 inserted provision requiring that the
minimum property standards established by the Secretary
under this section were to contain energy performance
requirements to achieve a significant increase in the energy
efficiency of new construction.
2) Parts of the U.S. Code containing the phrase
“minimum property standards” that are not
applicable to the MPS:
1490i Department of Agriculture (repealed)
1479 (a)(2) Department of Agriculture
1710 (h)(5)(A)(iii) and (B)(iii) Disposition of HUD
properties
1703 (a)(2)(i) Manufactured housing
1713 (c)(3) Rental housing
1715e (p) Cooperative housing
1715v (c)(2) Elderly housing
1715w (d)(2)(B) Care facilities
1715y (j) Multifamily
1715z-6 (e)(1) Multifamily
1715z-7 (d)(2)(B) Hospitals
1749aaa (c)(2) Medical practice facilities
5403 (h)(3) Manufactured housing

50
Appendix G
SECTIONS OF THE CODE OF FEDERAL REGULATIONS CONTAINING THE PHRASE
“MINIMUM PROPERTY STANDARDS”
(not including 24CFR 200.926 and 24CFR200.926 a-e, which constitute MPS Appendix K)
Note: Underlining added for emphasis.
Sec. 55.1.(a) This part implements the requirements
of Executive Order 11988, Flood-plain Management,
and employs the principles of the Unified National
Program for Flood-plain Management. It covers the
proposed acquisition, construction, improvement,
disposition, financing and use of properties located in
a flood plain for which approval is required either
from HUD under any applicable HUD program or
from a grant recipient subject to 24 CFR part 58.....(c)
Except with respect to actions listed in Sec. 55.12(c),
no HUD financial assistance (including mortgage
insurance) may be approved after May 23, 1994 with
respect to: (1) Any action, other than a functionally
dependent use, located in a flood way; (2) Any
critical action located in a coastal high hazard area; or
(3) Any non-critical action located in a coastal high
hazard area, unless the action is designed for location
in a coastal high hazard area or is a functionally
dependent use. An action will be considered to be
designed for location in a coastal high hazard area if:
(i) In the case of new construction or substantial
improvement, the work meets the current standards
for V zones in FEMA regulations (44 CFR60.3(e))
and, if applicable, the Minimum Property
Standards for such construction in 24 CFR
200.926d(c)(4)(iii); or (ii) In the case of existing
construction (including any minor improvements):
(A) The work met FEMA elevation and construction
standards for a coastal high hazard area (or if such a
zone or such standards were not designated, the
100-year flood plain) applicable at the time the
original improvements were constructed; or (B) If the
original improvements were constructed before
FEMA standards for the 100-year flood plain became
effective or before FEMA-designated the location of
the action as within the 100-year flood plain, the
work would meet at least the earliest FEMA
standards for construction in the 100-year flood plain.
Sec. 92.251. (a) (1) Housing that is constructed or
rehabilitated with HOME funds must meet all
applicable local codes, rehabilitation standards,
ordinances, and zoning ordinances at the time of
project completion, except as provided in paragraph
(b) of this section. The participating jurisdiction must
have written standards for rehabilitation that ensure
that HOME-assisted housing is decent, safe, and
sanitary. In the absence of a local code for new
construction or rehabilitation, HOME-assisted new
construction or rehabilitation must meet, as
applicable, one of three model codes: Uniform
Building Code (ICBO), National Building Code
(BOCA), Standard (Southern) Building Code
(SBCCI); or the Council of American Building
Officials (CABO) one or two family code; or the
Minimum Property Standards (MPS) in 24 CFR
200.925 or 200.926. To avoid duplicative inspections
when FHA financing is involved in a HOME-
assisted property, a participating jurisdiction may rely
on a Minimum Property Standards (MPS)
inspection performed by a qualified person. Newly
constructed housing must meet the current edition of
the Model Energy Code published by the Council of
American Building Officials. (2) All other
HOME-assisted housing (e.g., acquisition) must meet
all applicable State and local housing quality
standards and code requirements and if there are no
such standards or code requirements, the housing
must meet the housing quality standards in 24 CFR
982.401. (3) The housing must meet the accessibility
requirements at 24 CFR part 8, which implements
Section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 794) and covered multifamily dwellings, as
defined at 24 CFR 100.201, must also meet the
design and construction requirements at 24 CFR
100.205, which implement the Fair Housing Act (42
U.S.C. 3601-3619).
Sec. 200.925 Applicability of minimum property
standards. All housing constructed under HUD
mortgage insurance and low-rent public housing
programs shall meet or exceed HUD Minimum
Property Standards, except that this requirement
shall be applicable to manufactured homes eligible
for insurance pursuant to Sec. 203.43f of this chapter
only to the extent provided therein. The Minimum
Property Standards may be waived to the same
extent as the other regulatory requirements for
eligibility for insurance under the specific mortgage
insurance program involved.
Sec. 200.927 Incorporation by reference of
minimum property standards. The Minimum
Property Standards as contained in the handbooks
identified in Sec. 200.929(b) are incorporated by
reference into this section as though set forth in full
in accordance with 5 U.S.C. 552(a) and 1 CFR part
51.

51
Sec. 200.929 Description and identification of
minimum property standards. (a) Description. The
Minimum Property Standards describe physical
standards for housing. They are intended to provide a
sound basis for determining the acceptability of
housing built under the HUD mortgage insurance and
low-rent public housing programs. The Minimum
Property Standards refer to material standards
developed by industry and accepted by HUD. In
addition, under Section 521 of the National Housing
Act, HUD adopts its own technical suitability
standards for materials and products for which there
are no industry standards acceptable to HUD. These
standards are contained in Use of Materials Bulletins
that apply to products and methods and Materials
Releases that apply to specific materials. Use of
Materials Bulletins and Materials Releases are
addenda to the Minimum Property Standards.
Unless otherwise stated, the current edition, issue, or
version of each of these documents, as available from
its source, is applicable to this subpart S. A list of the
Use of Materials Bulletins, Materials Releases, and
MPS Appendix listing the applicable referenced
Standards may be obtained from the Construction
Standards Division, Office of Manufactured Housing
and Construction Standards, room 6170 Department
of Housing and Urban Development, 451 7th Street,
SW, Washington, DC 20410. (b) Identification. The
Minimum Property Standards have been published
as described below: (1) MPS for One and Two
Family Dwellings. See Secs. 200.926, 200.926 (a)
through (e). (2) MPS for Housing 4910.1, 1994
edition. This volume applies to buildings and sites
designed and used for normal multifamily occupancy,
including both unsubsidized and subsidized insured
housing, and to care- type housing insured under the
National Housing Act. It also includes, in Appendix
K, a reprint of the MPS for One and Two Family
Dwellings identified in paragraph (b)(1) of this
section.
Sec. 200.931 Statement of availability. (a) Updated
copies of the Minimum Property Standards and
Use of Materials Bulletins are available for public
examination in the Office of Consumer and
Regulatory Affairs, Department of Housing and
Urban Development, room 9156, 451 Seventh St.
SW., Washington, D.C. 20410-8000. In addition,
copies of volumes 1, 2, and 3 of the Minimum
Property Standards may be purchased from the U.S.
Government Printing Office, Washington, D.C.
20402. (b) Publications approved by the Director of
the Federal Register for incorporation by reference in
accordance with 5 U.S.C. 552(a) and 1CFR part 51.
Sec. 200.933 Changes in minimum property
standards. Changes in the Minimum Property
Standards will generally be made every three years.
Changes will be made in accordance with HUD
policy for the adoption of rules and regulations set
forth in part 10 of this title. Notice of such changes
will be published in the Federal Register. As the
changes are made, they will be incorporated into the
volumes of the Minimum Property Standards to
which they apply. The volumes available for public
examination and for purchase will contain all changes
up to the date of examination or purchase. An
official, historic file of such changes will be available
in the office of the Rules Docket Clerk in the HUD
Central Office in Washington, DC, and in each HUD
Regional, Area, and Insuring Office. A similar copy
of the standards will also be maintained in the Office
of the Federal Register, Washington, DC.
Sec. 200.935 Administrator qualifications and
procedures for HUD building products certification
programs. (a) General. This section establishes
administrator qualifications and procedures for the
HUD Building Products Certification Programs under
section 521 of the National Housing Act and the
HUD Minimum Property Standards. Under these
programs organizations acceptable to HUD validate
manufacturers' certifications that certain building
products or materials meet applicable standards.
HUD may decide to implement a certification
program for a particular building product or material
for a variety of reasons, such as when deemed
necessary by HUD to facilitate the introduction of
new and innovative products or materials; or in
response to reports of fraud or misrepresentation by
manufacturers in advertising that their product or
materials comply with a standard.
Sec. 200.1303 Annual income exclusions for the Rent
Supplement Program. (a) The exclusions to annual
income described in 24 CFR 5.609(c) apply to those
rent supplement contracts governed by the regulations
at 24 CFR part 215 in effect immediately before May
1, 1996 (contained in the April 1, 1995 edition of 24
CFR, parts 200 to 219), in lieu of the annual income
exclusions described in 24 CFR 215.21(c) (contained
in the April 1, 1995 edition of 24 CFR, parts 200 to
219). (b) The mandatory deductions described in 24
CFR 5.611(a) also apply to the rent supplement
contracts described in paragraph (a) of this section in
lieu of the deductions provided in the definition of
``adjusted income'' in 24 CFR 215.1 (as contained in
the April 1, 1995 edition of 24 CFR, parts 200 to
219). (c) The definition of ``persons with disabilities''
in paragraph (c) of this section replaces the terms
“disabled person'” and “handicapped person” used in
the regulations in 24 CFR part 215, subpart A (as

52
contained in the April 1, 1995 edition of 24 CFR,
parts 200 to 219). Person with disabilities, as used in
this part, has the same meaning as provided in 24
CFR 891.305. [66 FR 6224, Jan. 19, 2001] Appendix
A to Part 200--Standards incorporated by reference in
the Minimum Property Standards for Housing
(HUD Handbook 4910.1). The following publications
are incorporated by reference in the HUD Minimum
Property Standards (MPS) in 24 CFR part 200. The
MPS are available for public inspection and can be
obtained for appropriate use at 490 L'Enfant Plaza
East, Suite 3214, or at each HUD Regional, Area, and
Service Office. Copies are available for inspection at
the Office of the Federal Register, 800 North Capital
Street, NW., Suite 700, Washington, DC. The
individual standards referenced in the MPS are
available at the address contained in the following
table. They are also available for public inspection at
the HUD, Manufactured Housing and Construction
Standards Division, Suite 3214, 490 L'Enfant Plaza
East, Washington, DC 20024. Air Conditioning
Contractors of America 1513 16th Street, NW.,
Washington, DC 20036, (202) 483-9370.
Sec. 291.100 General policy. For all sales, except as
otherwise specifically indicated, those sales
conducted in accordance with Secs. 291.90(a) and
291.200 or with subpart D of this part, the following
general policies apply: (a) Qualified purchaser. (1)
Anyone, including a purchaser from a transferor of a
property pursuant to Secs. 291.90(a) and 291.200,
regardless of race, color, religion, sex, national
origin, familial status, age, or disability may offer to
buy a HUD-owned property, except that: (i) No
member of or delegate to Congress is eligible to buy
or benefit from a purchase of a HUD-owned property;
and (ii) No non-occupant mortgagor (whether an
original mortgagor, assumptor, or a person who
purchased ``subject to'') of an insured mortgage who
has defaulted, thereby causing HUD to pay an
insurance claim on the mortgage, is eligible to
repurchase the same property. (2) Neither HUD nor
any transferor pursuant to Secs. 291.90(a) or 291.200
will offer former mortgagors in occupancy who have
defaulted on the mortgage the right of first refusal to
repurchase the same property. (3) HUD will offer
tenants accepted under the occupied conveyance
procedures outlined in 24 CFR 203.670 through
203.685 the right of first refusal to purchase the
property only if: (i) The tenant has a recognized
ability to acquire financing and a good [[Page 494]]
rent-paying history, and has made a request to HUD
to be offered the right of first refusal; or (ii) State or
local law requires that tenants be offered the right of
first refusal. (b) List price. The list price, or ``asking
price,'' assigned to the property is based upon an
appraisal conducted by an independent real estate
appraiser using nationally recognized industry
standards for the appraisal of residential property. (c)
Insurance. Properties may be sold under the following
programs: (1) Insured. A property that meets the
Minimum Property Standards(MPS), as
determined by the Secretary, for existing dwellings
(Requirements for Existing Housing, One to Four
Family Living Units, HUD Handbook 4905.1, which
is available at the Department of Housing and Urban
Development, HUD Customer Service Center, 451
7th Street, SW, Room B-100, Washington, DC
20410; by calling (202) 708-3151; or via the Internet
at www.hud.gov) will be offered for sale in “as-is”
condition with FHA mortgage insurance available.
Flood insurance must be obtained and maintained as
provided in 24 CFR 203.16a. (2) Insured with repair
escrow. A property that requires no more than $5,000
for repairs to meet the MPS, as determined by the
Secretary, will be offered for sale in ``as-is'' condition
with FHA mortgage insurance available.
Sec. 941.203 Design and construction standards. (a)
Physical structures shall be designed, constructed and
equipped so as to improve or harmonize with the
neighborhoods they occupy, meet contemporary
standards of modest comfort and livability, promote
security, and be attractive and marketable to the
people they are intended to serve. Building design
and construction shall strive to encourage in residents
a proprietary sense, whether or not home ownership
is intended or contemplated. (b) Projects must comply
with: (1) A national building code, such as Uniform
Building Code, Council of American Building
Officials Code, or Building Officials Conference of
America Code; (2) Applicable State and local laws,
codes, ordinances, and regulations; and (3) Other
Federal requirements, including any Federal
fire-safety requirements and HUD minimum
property standards (e.g., 24 CFR part 200, subpart
S, and Sec. 941.208). (c) Projects for families with
children shall consist to the maximum extent
practicable of low-density housing (e.g., non-elevator
structures, scattered sites or other types of
low-density developments appropriate in the
community). (d) High-rise elevator structures shall
not be provided for families with children regardless
of density, unless the PHA demonstrates and HUD
determines that there is no practical alternative.
High-rise buildings for the elderly may be used if the
PHA demonstrates and HUD determines that such
construction is appropriate, taking into consideration
land costs, the safety and security of the prospective
occupants, and the availability of community
services.

53
Appendix H
SECTION 801 (12 USC SEC. 1701j-1)
Builder's Certification as to Construction

Note: Shading added for emphasis.
(a) Warranty requirements. The Secretary of Housing
and Urban Development is authorized and directed to
require that, in connection with any property upon
which there is located a dwelling designed principally
for not more than a four-family residence and which
is approved for mortgage insurance prior to the
beginning of construction, the seller or builder, and
such other person as may be required by the said
Secretary to become warrantor, shall deliver to the
purchaser or owner of such property a warranty that
the dwelling is constructed in substantial conformity
with the plans and specifications (including any
amendments thereof, or changes and variations
therein, which have been approved in writing by the
Secretary of Housing and Urban Development) on
which the Secretary of Housing and Urban
Development based his valuation of the dwelling:
Provided, That the Secretary of Housing and Urban
Development shall deliver to the builder, seller, or
other warrantor his written approval (which shall be
conclusive evidence of such approval) of any
amendment of, or change or variation in, such plans
and specifications which the Secretary deems to be a
substantial amendment thereof, or change or variation
therein, and shall file a copy of such written approval
with such plans and specifications: Provided further,
That such warranty shall apply only with respect to
such instances of substantial nonconformity to such
approved plans and specifications (including any
amendments thereof, or changes or variations therein,
which have been approved in writing, as provided
herein, by the Secretary of Housing and Urban
Development) as to which the purchaser or
homeowner has given written notice to the warrantor
within one year from the date of conveyance of title
to, or initial occupancy of, the dwelling, whichever
first occurs: Provided further, That such warranty
shall be in addition to, and not in derogation of, all
other rights and privileges which such purchaser or
owner may have under any other law or instrument:
And provided further, That the provisions of this
section shall apply to any such property covered by a
mortgage insured by the Secretary of Housing and
Urban Development on and after October 1, 1954,
unless such mortgage is insured pursuant to a
commitment therefor made prior to October 1, 1954.
(b) Availability of plans and specifications. The
Secretary of Housing and Urban Development is
further directed to permit copies of the plans and
specifications (including written approvals of any
amendments thereof, or changes or variations therein,
as provided herein) for dwellings in connection with
which warranties are required by subsection (a) of
this section to be made available in their appropriate
local offices for inspection or for copying by any
purchaser, homeowner, or warrantor during such
hours or periods of time as the said Secretary may
determine to be reasonable.
SOURCE (Aug. 2, 1954, ch. 649, title VIII, Sec.
801, 68 Stat. 642; Pub. L. 85-857, Sec. 13(s)(2), Sept.
2, 1958, 72 Stat. 1266; Pub. L. 90-19, Sec. 10(e),
May 25, 1967, 81 Stat. 22.)
CODIFICATION Section was enacted as part of the
Housing Act of 1954, and not as part of the National
Housing Act which comprises this chapter.

54
Appendix I
STUDY METHODOLOGY
This study of the MPS and its companion study of the
TSP Program consisted of completing the following
tasks:
Task 1. Assess MPS program statutes, regulations,
documents, processes, and procedures
• Assess relevant HUD laws and regulations. Review
HUD statutes and regulations that regulate the
construction of single family homes. Review the
Code of Federal Regulations and cite relevant rules
pertaining to single-family construction. Identify all
major components of the program required by statutes
and regulations.
• Assess HUD documents. Identify and review all
program manuals, handbooks, forms, and related
documents within the total MPS system for new
single-family (1 to 4 units) construction. Identify all
related HUD documents that are still active and
relevant. Identify all programs elements and
components, both fully operations and dormant, that
comprise the overall MPS system.
• Review processes, programs, and administration.
Undertake a comprehensive review of the procedures,
processes, and administration, including staffing, of
the MPS standards and the total systems in place for
its administration and enforcement including the TSP
and the Category III state program for factory-built
housing. Interview present and retired MPS and
related HUD staff as well as outside user and interest
groups, as appropriate.
Task 2. Ongoing communicaiton with HUD staff.
Provide a series of briefings to HUD staff as the work
progresses on our assessment of the current MPS
system, including the identification of any under
performing program components, program gaps, and
failures. Undertake the assessment within the context
of current usage by FHA for new construction; the
availability of competing programs; and the changing
needs in the housing industry. Include a discussion of
elements of the total system with continued or
potential importance to the housing industry or to
public policy independent of the need to insure
single-family mortgages for new construction.
Include recommendations for reform, including
replacement of program elements or
recommendations for legislative change.
Recommendations for alternative processes or
procedures will provide comparable levels of quality
or durability achieved under the present program.
For the MPS study, interviews were conducted with
the following individuals and organizations:
• HUD headquarters: Mark Holman (now retired),
Vince Tang, and Jason McJury, and retirees Bob
Fuller, Sam Hakopian, and Les Breden.
• Atlanta HOC: Debra Robinson
• Denver HOC: Jane Hall, Jerry Keeton, and Ron
Collins
• Philadelphia HOC: Gerry Glavey
• Santa Ana HOC: Karen Birdsong
• Merrill-Lynch: Charles Gueli
• Mortgage Insurance Companies of America
(MICA): Jeff Lubar,
• National Evaluation Service: David Conover and
Siavash Farvardin
• Bill Remmer, National Association of Home
Builders
Follow-up interviews to assess the implications of
MPS program changes included the following
organizations and individuals.
• Gerry Eid, builder
• Ron Burton, National Association of Home Builders
• Sam Hodges, Farmers Home Loan Administration
• Jerry Kifer, Department of Veterans Affairs
• Roger Kramer, HUD Multifamily Housing
• Bob Sahadi, FHMA
• Alexander Salenikovich, Mississippi Forest
Products Lab
• Joe Sherman, home inspector
• Jim Poulson, Insurance Services Organization
• John Stevens, HUD Manufactured Housing Divison

55
Appendix J
BIBLIOGRAPHY/RELATED HUD DOCUMENTS
The MPS program is set forth in HUD Handbook
4910.1, Minimum Property Standards for Housing,
dated July 29, 1994.
Related MPS Program publications are:
HUD Handbook 4950.1, Rev. 3, Technical Suitability
of Products Program Procedures, dated August 11,
1997.
HUD Handbook 4145.1, HUD Architectural
Processing and Inspections for Home Mortgage
Insurance, dated February 4, 1992.
HUD Handbook 4930.3, Permanent Foundations
Guide for Manufactured Housing, dated September
1996.
HUD Handbook 4940.2, Minimum Design Standards
for Community Sewage Systems, dated October 1992.
These publications are available online at
www.hudclips.org
Form HUD-92900-A, “HUD/VA Addendum to
Uniform Residential Loan Application” is a lender’s
certification that a property meets the MPS. Form
HUD-92541, “Builder’s Certification of Plans,
Specifications, and Site,” and Form HUD-92544,
“Warranty of Completion of Construction,” are
builder certification forms. Form HUD-92544,
“Agreement to Execute a Builder’s Warranty of
Completion of Construction,” is a builder’s warranty
form. These forms are available online at
www.hudclips.org
Mortgagee Letter 2001-27 of October 23, 2001,
provides the most recent pre-approval requirements
for new single family housing construction. HUD
issues about 50 mortgagee letters a year, some of
which apply to one- and two-family dwellings. All
mortgagee letters are available online at
www.hudclips.org
Recommended Minimum Requirements for Small
Dwellings Construction, published by the Department
of Commerce in 1922 and revised in 1932, is no out
of print, but a copy is available in the HUD Library in
Washington, D.C.
“Issue Paper on the Minimum Property Standards,”
from “Selected Background Papers: Housing
Construction Codes and Standards,” HUD-2451 of
November 1981, is out of print but is reprinted in full
herein.
Federal Regulations Impacting Housing and Land
Development: Recommendations for Change.
National Institute of Building Sciences, Washington,
D.C. April 15, 1981.

56
Appendix L
ACRONYMS
ANSI. American National Standards Institute. The
official U.S. standards organization.
ASTM. A major standards-writing organization that
publishes thousands of technical standards, including
over 600 construction standards.
BOCA. Building Officials and Code Administrators
International, one of the three model code
organizations that recently merged to create the ICC.
CABO. Council of American Building Officials,
formerly publisher the Model Energy Code and the
One and Two Family Dwelling Code. The
requirements of both codes are now included in the
International Residential Code. CABO has been
merged into the ICC.
CFR. United States Code of Federal Regulations.
FHA. Federal Housing Administration, formed in
1934 by the National Housing Act and consolidated
into HUD in 1965.
HOC. Home Ownership Corporation. HUD has four
regional HOCs: Denver, Santa Ana, Atlanta, and
Philadelphia.
HUD. U.S. Department of Housing and Urban
Development, a cabinet-level federal agency created
in 1965.
ICBO. International Council of Building Officials,
one of the three model code organizations that
recently merged to create the ICC.
ICC. International Code Council, recently created by
the county’s three model code organizations—
BOCA, ICBO, and SBCCI. The ICC publishes the
International Codes, including the International
Residential Code.
IRC. International Residential Code, published by
the ICC.
ISO. International Standards Organization, a
multinational standards-making body.
MPR. Minimum Property Requirements, an earlier
version of the MPS.
MPS. Minimum Property Standards. The subject of
this study.
NAHB. National Association of Home Builders.
NCSBCS. National Conference of States on Building
Codes and Standards, formerly third-party inspector
for HUD under the TSP Program.
NEC. National Electrical Code, published by NFPA.
NFPA. National Fire Protection Association, a major
standards-writing organization. It produces the
National Electrical Code, Life Safety Code, NFPA
5000, among many others.
NIBS. National Institute of Building Sciences, a
nonprofit, nongovernmental organization authorized
by Congress to serve as an authoritative source on
issues of building science and technology.
PATH. Partnership for Advanced Technology in
Housing, a private/public effort to improve the
quality, durability, environmental efficiency, and
affordability of the nation’s homes. PATH is
managed by HUD.
SBCCI. Southern Building Code Congress
International, one of the three model code
organizations that recently merged to create the ICC.
SLA. State Letters of Acceptance, a discontinued
element of the TSP Program.
USC. United States Code, a compilation of al