source:
  type: guide
  id: hud-4000-1-ii-d-construction-types
  authority: FHA Single Family Housing Policy Handbook 4000.1, Part II — d. Construction
    Types (02/16/2021)
  description: FHA Single Family Housing Policy Handbook 4000.1, Part II — d. Construction
    Types (02/16/2021).
  coverage_tier: operative
obligations:
- id: hud-4000-1-ii-d-construction-types-full
  canonical_id: hud-4000-1-ii-d-construction-types-full
  section: FHA Single Family Housing Policy Handbook 4000.1, Part II — d. Construction
    Types (02/16/2021)
  type: do
  tags:
  - regulator-direct
  - fha
  - hud-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: FHA Single Family Housing Policy Handbook 4000.1, Part II — d. Construction
      Types (02/16/2021)
    source_class: hud-handbook
    source_url: https://www.hud.gov/hud-partners/single-family-handbook-4000-1
    snapshot_id: 8c03836f77f317e1
    fetched_at: '2026-05-23T00:28:40Z'
    content_hash: sha256:411430f29b13f9b54a2ebb0e6f6e7087ecd2b90d0da22eb0c8c792eaa2d7d0df
    paragraph_quote: 'd. Construction Types (02/16/2021) i. New Construction (A) Definition
      New Construction refers to Proposed Construction, Properties (or Condominium
      Projects) Under Construction, and Properties Existing Less than One Year as
      defined below: • Proposed Construction refers to a Property where no concrete
      or permanent material has been placed. Digging of footing is not considered
      permanent. • Under Construction refers to the stage from the first placement
      of permanent material to 100 percent completion with no CO or equivalent. •
      Existing Less than One Year refers to a Property that is 100 percent complete
      and has been completed less than one year from the date of issuance of the CO
      or equivalent. The Property must have never been occupied. II. ORIGINATION THROUGH
      POST-CLOSING/ENDORSEMENT C. Condominium Project Approval 2. Project Eligibility
      Handbook 4000.1 799 Last Revised: 11/26/2025 Complete Condominium Project refers
      to a Condominium Project consisting of Units that are Existing Less than One
      Year and that are ready for occupancy, including completion of all the Infrastructure
      of the Condominium Project, and not subject to further rehabilitation or construction.
      Complete Legal Phase refers to a Legal Phase in which all Units are built out
      and all Units have a CO or the equivalent. (B) Standard The Condominium Project,
      or Legal Phase, as applicable, must be either a Complete Condominium Project
      or a Complete Legal Phase. Form HUD-92541, Builder''s Certification of Plans,
      Specifications, and Site, must be signed and dated. The completed form must
      show any issues noted by the builder/developer and proposed mitigation plans.
      (C) New Construction Additional Requirements (1) Financial Condition If no Units
      have closed in the Condominium Project, a proposed budget is required. All Financial
      Condition – Required Documentation is required if any Unit has closed. Financial
      condition documentation for Condominium Projects operating less than one year
      must cover the operating period since the sale of the first Unit. (2) Minimum
      Insurance Coverage If no Units have closed in the Condominium Project, a builder’s
      policy is acceptable in lieu of Hazard Insurance, Liability Insurance, and Fidelity
      Insurance. All minimum Insurance Coverage is required if any Unit has closed.
      (D) Required Documentation The following documents must be submitted: • form
      HUD-92541, signed and dated; • additional documentation demonstrating mitigation
      of any issues noted in form HUD-92541 including the State Licensed engineers’
      (soil and structural) reports, designs, and/or certifications to ensure the
      structural soundness of the improvements and the health and safety of the occupants;
      II. ORIGINATION THROUGH POST-CLOSING/ENDORSEMENT C. Condominium Project Approval
      2. Project Eligibility Handbook 4000.1 800 Last Revised: 11/26/2025 • a copy
      of the builder’s policy or the required documentation in Insurance Coverage;
      • a CO or its equivalent; and • photographs of each building. ii. Newly Converted
      A Condominium Project is considered newly converted if the Date of Conversion
      is within 24 months of the time of Condominium Project submission. Date of Conversion
      refers to the date that the legal documents were recorded. Newly converted Condominium
      Projects can only be processed under the HRAP option. (A) Gut Rehabilitation
      Conversion (1) Definition Gut Rehabilitation (Gut Rehab) refers to the renovation
      of a Property down to the shell of the structure, including the replacement
      of all Heating, Ventilation and Air Conditioning (HVAC) and electrical components.
      (2) Standard Gut Rehabs must meet the general FHA Condominium Project approval
      requirements and New Construction standards. (3) Required Documentation The
      following documents must be submitted: • form HUD-9992; • an engineering or
      architectural inspection, dated within 12 months, evidencing all rehabilitation
      work/repairs have been completed; and • a CO or its equivalent. (B) Non-Gut
      Rehabilitation (1) Definition Non-Gut Rehabilitation (Non-Gut Rehab) refers
      to rehabilitation work that is not structural and is limited to minor property
      repairs and improvements. (2) Standards Non-Gut Rehabs must meet the standards
      for Existing Construction. II. ORIGINATION THROUGH POST-CLOSING/ENDORSEMENT
      C. Condominium Project Approval 2. Project Eligibility Handbook 4000.1 801 Last
      Revised: 11/26/2025 A reserve study must be 36 months old or less and have been
      prepared by an independent third party that has demonstrated knowledge of and
      experience in completing reserve studies. The reserve study must include analysis
      of the Non- Gut Rehab. All Non-Gut Rehab work/repairs must be completed. (3)
      Required Documentation The following documents must be submitted: • form HUD-9992;
      • reserve study; and • evidence that all rehabilitation work/repairs have been
      completed.'
  judgment: false
