Best State/City for Section 8

[MARK S KING]

Hello, any input on the best market for section 8? Looking for a way to analyze the highest allowance from Sec8 vs the lowest priced homes, wondering where you can get the most bang for your buck. I have heard the target is at least 400-500 per month net positive cash flow based on 20% down. Where are you seeing opportunities? Thank you!

[Arsen Atanasovski]

Detroit hands down!

[Nick Benjamin]

KC is up there!

[Sara Frank]

Surprisingly, there are pockets of Washington DC that can net you significant cash flow using Section-8. I recommend looking into Dr. Joe Asamoah -- he is a prominent section 8 investor in DC. We had him as a guest on our podcast - the DC Real Estate Podcast, he was episode #10 

[David Greathouse]

I've had some success with clients here in Cleveland

[Bob Stevens]

Quote from @MARK S KING:

Hello, any input on the best market for section 8? Looking for a way to analyze the highest allowance from Sec8 vs the lowest priced homes, wondering where you can get the most bang for your buck. I have heard the target is at least 400-500 per month net positive cash flow based on 20% down. Where are you seeing opportunities? Thank you!

WE GET 1200- 1400 A month on 3/4 br  props with all in pricing under 100k in the Cleveland markets. Heck I just got 825 for a 1 BR in East Cleveland, 

[Travis Biziorek]

I have three tenants on Section 8. For a 3 bed/1bath home you can easily get $1,300/mo here in Detroit. And numbers I believe are up to $1,650/mo (or something like that) if you include utilities. I know they adjusted voucher limits higher again this year and we'll be pushing for increases on ours when they come up for renewal.

[Arsen Atanasovski]

Quote from @Sara Frank:

Surprisingly, there are pockets of Washington DC that can net you significant cash flow using Section-8. I recommend looking into Dr. Joe Asamoah -- he is a prominent section 8 investor in DC. We had him as a guest on our podcast - the DC Real Estate Podcast, he was episode #10 

yea with half million dollar homes you can buy 10/15 properties in the D that will net double then DC

[Sam Yin]

@MARK S KING

You just need to get the section 8 payment schedule. Pretty much everywhere it good. Every area has set prices section 8 will pay for certain properties.

A 2 bedroom in one area can command $800/month from section 8 and that same property will also command $2800/month down the road in a higher end area. It different within the county. They divide them by submarkets. It's all relative.

For example, in just one single county of SoCal, where I primarily invest, the desert section 8 pays $827 for a studio and $1733 for a two bedroom. At the other end of the same county, section 8 pays $1925 for a studio and $3028 for a 2 bedroom. The average cost per door is $100K versus $175K. So it all relative. I'm using 2022 pricing schedule, bit I'm sure its higher now since it generally increases every year. Just get it for the area you are interested in.

If section 8 is your play, you should take advantage and look for higher end areas so you can get the most out of more expensive properties that have more to appreciate. That's as long as you can afford to acquire it in the first place.

The question you should ask yourself is if you want section 8 in the first place. It not for everyone. It comes with it's own challenges. Deal with enough section 8 tenants and you will find out it not as rosy as some podcasts or books claim them to be. But you do get that guaranteed rent as a trade off for your work.

I have some section 8 tenants and other programs that are 10X tougher. I would NOT mix them with regular families as it often can create management challenges. But that is just a personal opinion based on personal experience with government tenants in California.

Good luck.

[James Wise]

Quote from @MARK S KING:

Hello, any input on the best market for section 8? Looking for a way to analyze the highest allowance from Sec8 vs the lowest priced homes, wondering where you can get the most bang for your buck. I have heard the target is at least 400-500 per month net positive cash flow based on 20% down. Where are you seeing opportunities? Thank you!

 Cleveland is pretty dope for Section 8 deals.

[Scott Allen]

@MARK S KING

Columbus,OH is pretty dope for Section 8 deals. Cleveland is alright too

[Sanat Bhandari]

@MARK S KING Check out Council Bluffs, IA. It's right across the river from Omaha, has the same HUD FMRs as Omaha but properties there are at least 20% cheaper

Cash-flowing rentals is the name of the game out there so pretty sure you could do great with section 8

[Drew Sygit]

@MARK S KING

You might want to follow the "Deep Dive" series we're doing on our BiggerPockets blog about Metro Detroit cities, City of Detroit Neighborhoods and comparing Metro Detroit to other hotspots investors usually consider:

https://www.biggerpockets.com/...
(BP search feature can be problematic, so we’ve also added links @ our website under View Cities & Neighborhoods We Service)

Please send us any feedback via email, as we do not use the DM feature here.

[James Wise]

Quote from @Scott Allen:

@MARK S KING

Columbus,OH is pretty dope for Section 8 deals. Cleveland is alright too

 Bruh.....My dad can beat up your dad.

[Arsen Atanasovski]

Who’s your daddy??????

Detroit!!!

[Arsen Atanasovski]

Sorry I was just thinking about the Michigan and OSU game a few months back oops! Sorry again :)

[Drew Sygit]

@MARK S KING you will find nice numbers with any Class C properties

[Michael Bishay]

Quote from @Travis Biziorek:

I have three tenants on Section 8. For a 3 bed/1bath home you can easily get $1,300/mo here in Detroit. And numbers I believe are up to $1,650/mo (or something like that) if you include utilities. I know they adjusted voucher limits higher again this year and we'll be pushing for increases on ours when they come up for renewal.

 Would you mind sharing what parts of Detroit you invest in? Or what parts to stay away from. 

[Michael Bishay]

Quote from @Scott Allen:

@MARK S KING

Columbus,OH is pretty dope for Section 8 deals. Cleveland is alright too

 I would love to have a quick conversation if your ever free. I would like to learn more about Columbus OH. 

[Travis Biziorek]

Quote from @Michael Bishay:

Quote from @Travis Biziorek:

I have three tenants on Section 8. For a 3 bed/1bath home you can easily get $1,300/mo here in Detroit. And numbers I believe are up to $1,650/mo (or something like that) if you include utilities. I know they adjusted voucher limits higher again this year and we'll be pushing for increases on ours when they come up for renewal.

 Would you mind sharing what parts of Detroit you invest in? Or what parts to stay away from. 

That's a pretty big conversation. Detroit itself is 150 sq miles. People have no concept how much ground that actually is. 

[Jimmy Lieu]

Quote from @MARK S KING:

Hello, any input on the best market for section 8? Looking for a way to analyze the highest allowance from Sec8 vs the lowest priced homes, wondering where you can get the most bang for your buck. I have heard the target is at least 400-500 per month net positive cash flow based on 20% down. Where are you seeing opportunities? Thank you!

Hi Mark, Columbus Ohio is a great market for section 8 rentals. I really see Columbus Ohio as an extremely safe bet for the next 10-20 years. Plus, there's still so many positive cash flowing and 1% deals here in Columbus Ohio. Just this month, I’ve gotten under contract for my clients for multiple 20%+ cash on cash rental properties so there’s definitely tons of opportunity here. As a local investor and agent here in Columbus, let me know if you have any questions or want to connect!

[David Leggett]

Oh Man!  Michigan wins two years out of 20 and I can't stop hearing about it!  But I love Detroit and Michigan and want to see Detroit rebuild itself stronger than ever.  Industrial midwest cities help built this country and this economy and many got left behind after the manufacturing left and I've seen it first hand how it destroyed communities but they're resilient cities with very strong and resilient people and are excellent for Section 8 rentals.

[David Leggett]

My dad looked just like Chuck Norris but never learned Karate!  Can you believe that!  Man my life could have been totally different growing up in a Chuck Norris Karate household!!

[Arsen Atanasovski]

Let me just say there is 30,000 section 8 open contracts in the city of Detroit maybe that might turn some lightbulbs on lol

[Aaron K.]

Quote from @Arsen Atanasovski:

Let me just say there is 30,000 section 8 open contracts in the city of Detroit maybe that might turn some lightbulbs on lol

 Hey Arsen can you elaborate more on what this means? Do you mean there are currently 30,000 Section 8 voucher holders with no where to go due to a lack of section 8 housing or something else?

[Arsen Atanasovski]

Absolutely