Understanding Tenancy in PSH: Landlord Responsibilities

If you’re a property owner or operator partnering with Threshold to provide housing through the Permanent Supportive Housing (PSH) program, you’ll take on responsibilities under two separate agreements:

Your rental agreement with the tenant – covering everyday matters like rent collection, property upkeep, and lease terms.
Your Housing Assistance Payments (HAP) contract with HOM or other housing assistance provider – setting program requirements and outlining how rental assistance is paid on the tenant’s behalf.

The HAP contract works alongside your rental agreement to provide stability for the tenant and protect your role as a landlord. Together, they form a framework that helps sustain housing for vulnerable individuals while ensuring you receive timely rent payments and maintain compliance with program rules.

In this guide, we’ll give you a clear picture of your responsibilities during a PSH tenancy — starting with a closer look at the HAP contract, then outlining your key duties throughout the tenancy, and finally sharing tips for successfully concluding the lease.

Confidence comes from clarity. With clear agreements, reliable rent payments, and access to Threshold’s support network, landlords can manage their properties with ease and assurance.

Understanding the HAP Contract

The Housing Assistance Payments (HAP) contract is a formal agreement between you and HOM (or other housing assistance provider) that enables tenant-based rental assistance. It sets the terms for:

Who lives in the unit and for how long
The initial rent amount and the division between HOM’s (or any other housing assistance provider’s) subsidy and the tenant’s share
Which utilities and appliances are your responsibility vs. the tenant’s

Your rental agreement covers the day-to-day aspects of tenancy, and the HAP contract focuses on program-specific rules — such as compliance with Housing Quality Standards (HQS), protections under the Violence Against Women Act (VAWA), and adherence to fair housing laws. Both agreements must be followed to avoid issues such as delayed payments, contract violations, or termination from the program.

While the HAP contract provides consistent subsidy payments during the lease term, it’s important to note these payments are tied to the tenant’s eligibility and occupancy. Payments may end if the tenancy ends — for example, due to program termination, eviction, or the tenant’s passing.

Benefits

Beyond the subsidy payments, the HAP contract offers additional benefits:

Access to our risk mitigation fund for damages beyond normal wear and tear or unexpected vacancies
Clear guidance on conflict-of-interest rules, contract assignment, and foreclosure situations
A support network of service providers who work with tenants on stability, employment, and other resources — allowing you to focus on property management while contributing to stronger communities

Renters agree to a tenancy with their landlord

With both the rental agreement and HAP contract in place, landlords and tenants can move forward with confidence.

Before signing, review all three parts of the HAP contract:

Part A: Basic details about the tenant, unit, and rent
Part B: Agreement terms, maintenance standards, payment procedures, and remedies for breach
Part C: The tenancy addendum — required in your lease — that covers tenant rights, rent change rules, and protections under VAWA

✅ Need more info? Check out our HAP contract deep dive.

✅ Questions? Reach out to your Landlord Support Specialist.

✅ Blog: What If I’m Having Trouble Getting My Units Rented?

Key Responsibilities During the Tenancy

Once the tenancy is underway, you should treat it like any other standard Arizona tenancy, governed primarily by the Arizona Residential Landlord and Tenant Act (ARLTA). You manage the lease as you normally would — maintaining habitability, ensuring safety and compliance, respecting tenant rights and privacy, and completing legal and administrative tasks.

Here are a few basic responsibilities for a property owner or operator during an active tenancy:

Maintaining the Property

Under Arizona law and the HAP contract, you must keep the rental unit safe and livable. This means following local building codes related to health and safety. You must make needed repairs to plumbing, heating, electrical systems, and the building’s structure. You’re also responsible for fixing any appliances you provide. Ventilation and air conditioning must work properly, especially in Arizona’s extreme heat.

You must also keep common areas clean and safe. Provide proper trash bins and regular waste removal. Make sure the unit has running hot and cold water.

Ensuring Safety and Compliance

Safety is non-negotiable under the HAP contract, which requires full compliance with Housing Quality Standards (HQS). These standards cover essentials such as secure locks and windows, functional smoke and carbon monoxide detectors, and other measures to ensure a safe living environment. The owner must provide all utilities necessary to meet HQS if specified in the contract and arrange for required inspections, including gas or electrical safety checks.

In Arizona, this aligns with state laws that mandate secure entry points and timely resolution of hazards to prevent accidents. Owners are responsible for ensuring the unit passes the initial HQS inspection. After that, the responsibility for utilities depends on the information provided in the Request for Tenancy Approval (RFTA) and the terms of the lease agreement. As long as the lease and RFTA are consistent, utilities may be the tenant’s responsibility.

a landlord fixes a leak during a tenancy

Under Arizona law and the HAP contract, landlords are responsible for timely repairs that ensure safe, livable housing.

Respecting Tenant Rights and Privacy

A fundamental principle of tenancy is allowing “quiet enjoyment,” meaning tenants can live peacefully without harassment or unnecessary interference from their landlord or property owner. In Arizona, this requires providing at least two days’ written notice before entering the unit for non-emergencies, such as repairs or inspections. Exceptions apply only for legitimate emergencies like fires or floods. The HAP contract echoes this by prohibiting unannounced visits and emphasizing cooperation with HOM for any program-related entries.

Legal and Administrative Duties

Beyond day-to-day management, you have administrative responsibilities like properly handling security deposits (limited to 1.5 months’ rent in Arizona, with returns due within 14 business days after tenancy end, including an itemized deduction list — failure could result in double damages owed to the tenant).

In most cases for the PSH program, if a housing assistance provider pays the refundable deposit on behalf of the tenant, the deposit is refunded back to HOM in our company name — not the tenant. If the tenant pays their own deposit, it is refunded directly to them. Additionally, if the housing assistance provider paid the refundable deposit, the itemized deduction letter must also be sent to them.

At the start of the tenancy, provide required documents such as a signed lease copy, a move-in inspection form, contact information for legal notices, and access to the ARLTA. Clarify utility responsibilities upfront to avoid confusion.

As a reminder to landlords: subsidized tenants are like any other renter. If a tenant violates their lease, fails to pay rent, or is at risk of eviction, HOM or the housing provider must be notified. HOM should also receive copies of any legal documents served to the tenant — including 2-day, 5-day, 10-day notices, eviction notices, and upcoming lease renewal proposals.

Quiet enjoyment means families can feel at home — living peacefully without unnecessary interruptions.

As the Tenancy Nears the End

As a tenancy ends—whether from lease expiration, a move, or another reason—preparation is key. It helps reduce downtime and protect your investment. Tenants usually give notice as required by the lease. You’ll work with HOM or your Landlord Support Specialist to plan the handover. Early communication helps ensure a smooth process and resolves any remaining issues.

✅ Is Your Tenant Staying? Check out our Property Owner’s Guide to Lease Renewals.

A critical step at the end of the tenancy is the move-out inspection, which you should request within two business days of regaining possession of the unit. This inspection, conducted by HOM’s team or a service provider, documents the unit’s condition, high-quality photos, and notes on any tenant-caused damages beyond normal wear and tear.

✅ Ensure your property passes the inspection. Read Home Inspections Made Easy with Our HQS Checklist.

Threshold’s Risk Mitigation Fund

If problems arise, such as damages or unpaid rent, you may be eligible to file a claim through Threshold’s Risk Mitigation Fund within 30 days by emailing the completed Damage Claim and Vacancy Loss Worksheet to damageclaims@hominc.com. Coverage can include up to one month’s contract rent for repairs, cleaning, or arrears, prorated as needed — backed by invoices, photos, and the inspection report.

Vacancy loss coverage provides an additional financial buffer, reimbursing up to one prorated month’s rent if the unit sits empty unexpectedly (excluding cases like tenant death). This support reduces your exposure during transitions, allowing you to focus on re-leasing confidently.

✅ Here’s everything you need to know about How to File a Damage Claim with Threshold.

✅ What’s next? Read our blog, Moving Out: A Guide for Property Owners.