Who determines Section 8 rent amount?

Question

Who determines the rent amount for my unit if I want to rent it out for section 8. The local housing authority or myself? I understand section 8 pays 50% to 80% percent of the rent, and the tenant pays the rest. If I want to set the rent at $1,000 a month will the local housing authority not allow it?

Jennifer Donley · Answer

@Juan David Maldonado, this question has come up a bunch in other posts lately.  Unfortunately, there is not a simple answer to this question.

Initially, in the landlord packet that you submit to your local Housing Authority, you will request a certain rent amount.  Then the HA will let you know whether they will give you that rent amount or not and if not, how much they will give instead.

Typically, your local Housing Authority will pay a "reasonable" rent for the unit (basically a comparable rent amount to what similar units of same size/amenities for market units in the area) up to what the local HA has determined to be the "payment standard".  You can Google payment standard but basically every HA sets a payment standard, which should be close to the "Fair Market Rent" set for your market.  The FMR is a rent rate set by HUD based on rent averages for the area.  You can find the FMR for your area by going to Google.

Your local HA may or may not publish their payment standards.  Some HAs are very open about their payment standards and some are not.

So I think of it like this - the "rent reasonableness" sets the first ceiling for rent.  Then the payment standard sets the 2nd except that the tenant can make up the difference between your rent and the payment up to 10% of their income. (Basically Section 8 doesn't want the tenant paying more than 40% of their adjusted income to housing expenses).

And there's a whole bunch of other factors, like number of dependents, child care expenses, etc. that play into the formula.

And each Housing Authority has some autonomy in how they set rents so it varies from one to the next somewhat.  Silly but true.

Lastly, the range of tenant portion of rent can range from almost all to none.  I've had tenants who paid 80% of their rent and I have some who pay $0.  It's all based on their tenant's income (the tenant is supposed to pay 30% of their income to housing expenses, including utilities).

Quite honestly, I believe your best bet is to find a successful Section 8 landlord in your area who can give you an idea of rents.  Some Housing Authorities are very transparent in expected rents and others aren't, so you could also try calling the HA locally to see if they can give you a firm answer as well.

Juan David Maldonado · Answer

Thank you so much! I will take action on your advice!

Mikel Kaubfa · Answer

you can search your local government's website for that information. they usually take the prior year's rent rate and apply some adjustments for it.