Additional rent over and beyond section 8’s “fair market rent”

[Frank Maratta]

I just finished a two family rennovation and it came out beautiful (granite counters, SS appliances, back splash, the works), lots of interest from prospective tenants at the rents I have listed ($1850, and $1650- first and second units, respectively).

99% of these tenants are section 8. I know from dealing with section 8 in the past that they set what’s called a “fair market rent”. Out of this fair market rent the government pays a portion and the tenant pays a portion.

The problem is that I know from dealing with section 8 in the past is that they are going to be a few hundred dollars off from what I am asking for rent and their “fair market rent”.

I have lots of interest in the property, and all the tenants I have screened have offered to me that they will pay their portion of the voucher and the additional difference of what section 8 doesn’t cover, in order to get to the rents I’m asking.

I’ve heard of people doing this all the time, but Could this potentially land me in trouble with the government/section 8?

[John Underwood]

For my location, Section 8 pays 110% of market rents.

Given that you are only getting section 8 tenants you may have over improved for your area.

The section 8 office will identify how much of the rent they will pay and how much the tenant pays. Don't make any side deals for more money from the tenant as this will get you in hot water and you are definitely breaking the rules maybe the law?

Your best bet may be to hold out for a non section 8 tenant that will pay for how nice you have rehabbed the house.