A private survey of recent mover rents was completed for Rowan County, NC in August, 2005. The result was applied to the FMR for Rowan County, NC. HUD uses the results of a privately-conducted local RDD to adjust the FMR if the forward-trended result of the private survey is higher than the evaluated rent based on the regular update factor.
A monthly change factor is calculated in order to inflate the 2005 Intermediate Rent of $556 to August, 2005 in order to assess the RDD survey conducted in 2005. This is accomplished by taking the 18th root of the normal June, 2005 to December, 2006 update factor of 1.0713 using Regional CPI Information.
monthly change = 1.07131/18
monthly change = 1.07130.0556
monthly change = 1.0038
The 2005 Intermediate Base rent for Rowan County, NC is then inflated to August, 2005 using 2 months of growth for use in comparison to the RDD result of $581. The 2005 inflated intermediate rent is calculated as $556 x 1.00382 = $560. The following table enumerates the evaluation of the RDD Result:
| August, 2005 RDD Evaluation for Rowan County, NC | |||
|---|---|---|---|
| June 2005 Intermediate Rent |
June 2005 to August, 2005 Updated Rent for Comparison |
August, 2005 RDD Result |
Decision |
| $556 | $560 | $581 | Is $581 > $560 YES RDD Used |
Therefore, the August, 2005 RDD Result of $581 is inflated to December of 2006 using the monthly update factor for 16 months. The 2006 Intermediate rent for Rowan County, NC is then computed as follows:
= $581 x 1.003816
= $581 x 1.0631
= $618
This yields an effective June 2005 - December 2006 change factor for Rowan County, NC of $618 / $556 = 1.1115
NOTE: Intermediate figures may not sum due to rounding. Also, update factors presented here may not precisely match the "6/2005 to 2006 Update Factor" on the Final FY 2008 FMR summary page due to rounding of FMRs to whole dollar amounts.
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