Springfield Gardens, NY · Member since 2017 · 258 posts · 63 votes
Does it matter where you rental is? or are you guaranteed to get a section 8 tenant anywhere you make a rental unit and submit it to section 8? Newbie here looking to get into first section 8 rental.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
5y
@Jennifer Donley is certainly the expert, with great advice. I would just add some market considerations, such as distance to public transportation. Many times people who need Section 8 assistance cannot afford a vehicle and insurance. If your property is within easy walking distance of public transportation, you will have a larger pool of applicants to choose among.
Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
5y
Sec 8 is a voucher that a person needs to apply for. They can apply anywhere that will accept them and if they can afford the rent. In some places, you can't discriminate against a Sec 8 as a source of income (like Portland). MOst places (in Oregon) have housing authorities that administer these for their territories.
You just advertise your apartment for rent and see who applies. Sec 8 is not going to get you more rent (however, on the Sec 8 part you'll get a ETF on the 1st.) Also, in most cases, Sec 8 won't pay the whole rent and the tenant makes a co-pay if they have any income at all.
Sec 8 is a voucher that a person needs to apply for. They can apply anywhere that will accept them and if they can afford the rent. In some places, you can't discriminate against a Sec 8 as a source of income (like Portland). MOst places (in Oregon) have housing authorities that administer these for their territories.
You just advertise your apartment for rent and see who applies. Sec 8 is not going to get you more rent (however, on the Sec 8 part you'll get a ETF on the 1st.) Also, in most cases, Sec 8 won't pay the whole rent and the tenant makes a co-pay if they have any income at all.
In my market, section 8 is almost the same as market rent (aside from the new-build luxury rentals), so for a crappy place, you could get more rent from section 8. Unfortunately, some slumlords know it and don't do repairs or maintain their units.
For OP, yes, you can take section 8 vouchers anywhere they are offered. There aren't any rules about neighborhoods or anything that I'm aware of. There is almost always a waiting list, so there's no shortage of tenants. Your property has to get inspected yearly to be up to their standards, which aren't that high. The biggest problem seems to be having the tenants maintain them in that condition.
Section 8 can be a tough niche. I know people that do it with few problems, though.
Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
5y
Well, there are more Sec 8 voucher than LIH properties with LURAs, so the rents paid do need to be close to market-rate, hence the annual HUD studies on what is FMR for their part of the payout.
Rental Property Investor · Saint Louis, MO · Member since 2018 · 228 posts · 279 votes
5y
@Isaac El, you can do it anywhere. Section 8 is a federally funded program administered locally by a Public Housing Authority, so you may have different Public Housing Authorities to deal with depending on where you're at (I have 2 here in St. Louis that I work with, for instance).
While the general structure and rules are the same nationally, each PHA will have their own little differences, particularly when it comes to setting rents, timing for rent increase requests, and inspection frequency and difficulty.
It is not against federal housing laws not to take Section 8 but it can be against it not to based on a state or city law (in these cases, it is usually against the law to not take Section 8 AND it's against the law to do what I do, which is only take Section 8 because you can't discriminate based on "source of income").
As mentioned above, Section 8 rents are usually in line with market rents in B, C and D areas. They can even be a little above market rents, particularly in C and D areas. However, they will generally be below market rents in A areas because there is a ceiling on the amount that HUD will pay in rent, determined by your area's Fair Market Rent.
A lot of people end up hating Section 8 because they don't execute on it as well as they could. It takes meticulous tenant screening (which I would do anyway), solid processes & attention to detail to do well. I think it's worth it given the guaranteed rent and stability that it provides but it's not for everyone.
Also, there are great Section 8 tenants out there so my approach is to provide one of the nicest properties in the neighborhood - that way I attract a large number of applicants quickly and I can then pick the top one to live in my property.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
5y
@Jennifer Donley is certainly the expert, with great advice. I would just add some market considerations, such as distance to public transportation. Many times people who need Section 8 assistance cannot afford a vehicle and insurance. If your property is within easy walking distance of public transportation, you will have a larger pool of applicants to choose among.
Sec 8 is a voucher that a person needs to apply for. They can apply anywhere that will accept them and if they can afford the rent. In some places, you can't discriminate against a Sec 8 as a source of income (like Portland). MOst places (in Oregon) have housing authorities that administer these for their territories.
You just advertise your apartment for rent and see who applies. Sec 8 is not going to get you more rent (however, on the Sec 8 part you'll get a ETF on the 1st.) Also, in most cases, Sec 8 won't pay the whole rent and the tenant makes a co-pay if they have any income at all.
Thank you for the feedback, I guess my question is more, could you make a nice rental unit (that passes inspection) and then it sits empty because no section 8 tenant wants to take it? or are you guaranteed to fill the unit with a tenant? (considering there is a local PHA)
@Isaac El, you can do it anywhere. Section 8 is a federally funded program administered locally by a Public Housing Authority, so you may have different Public Housing Authorities to deal with depending on where you're at (I have 2 here in St. Louis that I work with, for instance).
While the general structure and rules are the same nationally, each PHA will have their own little differences, particularly when it comes to setting rents, timing for rent increase requests, and inspection frequency and difficulty.
It is not against federal housing laws not to take Section 8 but it can be against it not to based on a state or city law (in these cases, it is usually against the law to not take Section 8 AND it's against the law to do what I do, which is only take Section 8 because you can't discriminate based on "source of income").
As mentioned above, Section 8 rents are usually in line with market rents in B, C and D areas. They can even be a little above market rents, particularly in C and D areas. However, they will generally be below market rents in A areas because there is a ceiling on the amount that HUD will pay in rent, determined by your area's Fair Market Rent.
A lot of people end up hating Section 8 because they don't execute on it as well as they could. It takes meticulous tenant screening (which I would do anyway), solid processes & attention to detail to do well. I think it's worth it given the guaranteed rent and stability that it provides but it's not for everyone.
Also, there are great Section 8 tenants out there so my approach is to provide one of the nicest properties in the neighborhood - that way I attract a large number of applicants quickly and I can then pick the top one to live in my property.
Thank you for the feedback and that makes a lot of sense and is great advice. So if I make a rental anywhere (and it passes inspection) in an area that has a PHA - then I am guaranteed to get a section 8 tenant?
@Jennifer Donley is certainly the expert, with great advice. I would just add some market considerations, such as distance to public transportation. Many times people who need Section 8 assistance cannot afford a vehicle and insurance. If your property is within easy walking distance of public transportation, you will have a larger pool of applicants to choose among.
Rental Property Investor · Saint Louis, MO · Member since 2018 · 228 posts · 279 votes
5y
@Isaac El, I would be hesitant to say that you're ever guaranteed to get a tenant in any situation. Specific to this question, people with Housing Choice Vouchers ("Section 8 tenants") get to pick their own housing, s it will be up to the individual tenant to choose your place.
What I will say is this - in my area and from what I hear in many places around the country, the demand for Section 8 housing far exceeds the supply so it is extremely easy to find Section 8 tenants.
Property Manager · Huntsville, AL · Member since 2017 · 302 posts · 246 votes
5y
@Isaac El A good place to start is to call the Housing Authority and see if they have tenants looking for specifications that fit your property. For example, if your rental is a 3 bedrooms, see what the rates are for that zip code for a tenant with a 3 bedroom voucher, and let the receptionist know the address so the case workers can pass it on to their clients. If I have a property that will take Section 8, I post it on gosection8.com. It's usually rented in less than 2 days.
@Isaac El A good place to start is to call the Housing Authority and see if they have tenants looking for specifications that fit your property. For example, if your rental is a 3 bedrooms, see what the rates are for that zip code for a tenant with a 3 bedroom voucher, and let the receptionist know the address so the case workers can pass it on to their clients. If I have a property that will take Section 8, I post it on gosection8.com. It's usually rented in less than 2 days.
@Isaac El, I would be hesitant to say that you're ever guaranteed to get a tenant in any situation. Specific to this question, people with Housing Choice Vouchers ("Section 8 tenants") get to pick their own housing, s it will be up to the individual tenant to choose your place.
What I will say is this - in my area and from what I hear in many places around the country, the demand for Section 8 housing far exceeds the supply so it is extremely easy to find Section 8 tenants.
Thank you, I really appreciate it, one more question I have is, I noticed in my market there are some 55+ communities, could you still get one of those and attract a section 8 voucher holder?
Well, there are more Sec 8 voucher than LIH properties with LURAs, so the rents paid do need to be close to market-rate, hence the annual HUD studies on what is FMR for their part of the payout.
Steve do you intentionally rent to any Voucher holders in the Portland Metro.