Closing on my first property with section 8 tenants, any advice?

[Andrew Freed]

I'll be closing on my first multifamily with section 8 tenants at the end of this month. I am looking to raise rent closer to market since they are well below (almost 40% below market). Have any advice for a new section 8 landlord? Is there anything I should keep in mind? Any tips of the trade? I appreciate the insight.

P.S. Please note that I am an experienced multifamily investor, however I'm new to the game of section 8.

[Ian Hogan]

From my experience, section 8 can do a lot of hand holding for the tenants that can help you out. They do an inspection annually that can help as a forcing function to keep up on a property if you have long term tenants. The inspection itself is pretty easy but can help you keep tabs on a property, of course only annually. 

When raising rent, you will have the extra step of it going for approval to whoever services their section 8 status and if the rent is within "market rent" it will get approved. They'll send you a document showing the split between the tenant and section 8. I think the only risk is if you are trying to really push to the upper edges of market rent, you may get push back or disapproval from section 8. Besides that I think it's pretty much the same as any other tenant from my experience.

Section 8 may help with covering a deposit, really depends on the tenant's situation.

I still did background checks, since you're inheriting tenants this may not apply. Section 8 does some level of background checks, but I did a deeper look than what section 8 will go into.