Realtor & single family Investor in NW suburbs of Chicago

[Eva Goulbourne]

Hello Everyone, Happy New Year! I finally joined the Biggerpockets community! I've been following Brandon for a couple of years now, maybe more, so it's time. This year I want to get deeper into investing and buy more properties. In addition to helping more people buy and sell their properties.

I listen to the Biggerpockets podcast frequently and I found the strategy I want to use in episode 356. Joe Asamoah is buying homes and renting them out to section 8 tenants in Washington D.C. As you probably know, the market in Washington D.C. is expensive. Although not as expensive here in the NW Suburbs of Chicago, we still have ridiculous taxes. Since they cleared out Cabrini-Green and other public housing from Chicago, we are seeing more section 8 housing moving into our neighborhoods. I see a need for more section 8 housing that's as good as a luxury apartment. I also see that Illinois won't be getting rid of this voucher program anytime soon, in fact, it's growing yearly. I agree that there is a stigma attached to section 8 housing and to be honest, it doesn't bother me. Everyone deserves a nice place to call home if they want one. I would say I have a talent for attracting and finding great tenants. I'm not afraid to dig deep and ask uncomfortable questions. If anyone is using this strategy in my area, I'd love to hear how it's working for you!

If you are in the Chicagoland area, in my specific area, let's connect! 

Having said all that.. I will be eventually making the move to Florida. September 2022 is the plan. Not exactly sure where.. somewhere along the Atlantic, possibly Delray Beach?? If anyone buys homes in Florida along the Atlantic, then rents them out to section 8 tenants I'd love to hear from you! I'd like to know if there is a need for it as much as there is here in the Chicagoland market. I'd also like to know if you think the state handels the process adequately. 

Thank you for taking the time to read my post! I look forward to connecting and learning from each other!

[Scot Howat]

Hey, I'm in your area!  Are you sure that you want to stock up on Section 8 tenants?  That's definitely not a strategy I'm interested in.

[David Kazarian]

@Eva Goulbourne

Not sure how you pick tenants with Section 8 but I met someone at a meetup on the NW side and they had a bad experience doing this. If you want, I can try to put you in contact with him, so you can ask him questions directly.  Every situation is different and maybe he only told me the bad side of doing it. DM if you are interested. 

I would love to hear other peoples experiences.

[Justin Browne]

Hi Eva! I'm not sure about the Section 8 rules down here but I'm living in Delray and loving it. I would love to chat about the area or answer any questions you have.

[Eva Goulbourne]

@David Kazarian People with low income apply for housing vouchers and then they look for a place to live. Chicago Housing Authority has it's own website with all the information about it. I would have to register my investment property with the housing authority and then people with section 8 would find it on the website. I would also advertise the property everywhere else. As a Realtor I have helped people rent out  homes, I always have people with section 8 vouchers call.. there's no shortage for sure.

[Eva Goulbourne]

@Scot Howat Great point. I like doing what most people are not. I feel it gives me an advantage. So yes, I'm sure I want to find great tenants where their rent is 80% (if not more) paid by CHA (Chicago Housing Authority). I plan on buying homes with more than 4 bedrooms, not condos as I currently own. A voucher from CHA for a 4 bedroom home can be up to $3,098.. 

Side note, I have a family member who works for cook county as a police officer, has for many years. He's been to his fair share of section 8 housing, I must admit, I have not, but I can image! These places can be disgusting with cockroaches as pets he mentioned. This is a common assumption with low income families. HOWEVER, he has been in section 8 housing that was Spotless! A hard smell of cleaning products all around to keep the cockroaches away. Just because a family is low on income doesn't mean that they aren't clean, in fact the opposite could be true. I see potential for great long lasting tenants where the rent is guaranteed. 

[Joseph Konney]

@Eva Goulbourne - Keep in mind that in Cook County (Section 8) / Chicago (Housing Choice Vouchers) source of income is a protected class. You don't have a choice but to accept vouchers as a source of income in those areas. Your other qualifications may disqualify them.

As far as screening tenants, keep in mind that a new law goes into effect this month that limits background checks in Cook County / Chicago. The skinny is that you can't ask about background issues until after all other screening has passed. Then you need to get written consent to perform a check and can ONLY consider the LAST THREE YEARS of criminal history. In your consideration, you can then only reject based on if they pose "a demonstrable risk to the personal safety and/or property of others". You can read the whole ordinance here: https://www.cookcountyil.gov/f...

Another common issue with section 8, especially in larger units as you are looking to do, is those families moving extra people in that are not on the voucher which cause extra wear and expense on your investment. Sure, you can evict, but that is time and money.

Happy landlording!

[Mark Ainley]

@Eva Goulbourne We did this as a strategy here in Chicago starting back in 2009 and you can hear about it on Podcast 72 here on BP.  Also, I wrote a blog on our website on the ins and outs of CHA that you can check out(they wont let me link here but I will PM it to you).  I know you are going to do this in Florida but a lot of the same applies in the larger housing authorities across the country.  

Right now we manage about 140 Section 8 tenants across 5 of the Chicagoland housing Authorities and can speak to the experience of all of them.  Happy to talk to you about any of the ins and outs anytime.  We are right down the street from you!

[Scot Howat]

Don't be under the false assumption that the rent voucher is guaranteed.  It's guaranteed as long as they comply with the program.  The worst scenario that can happen is they become disqualified for the program and lose the voucher, and you're stuck with a tenant that has no way of paying and no where else to go.