Buying Section 8 Property

[Joe Scaparra]

1st time buying a 4 plex and 1st time dealing with Section 8 tenants. I am looking at a 4 plex that has 4 tenants all section 8 and all on month to month leases. The property is located in Texas. All the units are the exact same: 2 Bedroom 1 Bath 916 sq ft. Two of the tenants are paying $625/month; one is paying $600 and the other one is paying $525. I called the HUD office and asked them what are they currently allowing for a 2 Bedroom 1 Bath unit. I was told that they just approved a new rental rate and that they are approving a 2 Bedroom 1 Bath up to $700 month. Now for my question: How difficult will it be for me once I buy the duplex to get the tenants to agree to $700/mo? Are they able to go back to the HUD office and get their vouchers reassess? I am told by the selling realtor that the difference in rental rates are because some tenants have been there longer than others and the owner was slow to increase. I am going to upgrade each unit with a built in microwave to show that I am improving the units. Apparently, there is a big need for Section 8 in the community and not enough units to accommodate the need. The street this 4 plex is on is all section 8 and I am thinking I would be one of the 1st to try and get $700/unit. What obstacles should I expect, and what other questions should I be asking before i buy this Section 8 property. Again no experience with Section 8. I do own 7 duplexes so I have rental experience but no section 8. Thanks Joe.

[Eddie T.]

@Tiffany Campbell it depends on the housing authority. Last time I purchase a property I called the representative in charge of transferring payments to new landlords she emailed me the documents I would need to submit and it was done in 2 days. Now this is in a city with a population of 200,000 so obviously they have less work load. If you are speaking of NYC Housing authority it is going to take longer as they have a larger work load. You will still receive the payment owed to you it just may be delayed.