To Section 8 or not to Section 8... That is the question!

[Martin Sterling]

Greetings. 

I know many investors who detest section 8 Tenants and can't stand or won't rent to them period. They especially hate owning or flipping properties in low income areas that usually have section 8 housing. 

Conversely, my mentor who is by all indications far more successful than the majority of local investors has built a very large portfolio in a short amount of time primarily on section 8 tenancy and prefers them to Tenants who are not qualified for section 8. 

What's the deal with these two extremes? It becomes difficult to find partners on section 8 deals when it seems most of the investor community has a bad taste in their mouth from it out here in South Jersey. 

What does the BP audience think about a section 8 prefirenze?

Thanks in advance. 

[Dumitru Anton]

@Martin Sterling,

if a lot of investors run from it, then there more left for you!!!

But:

long version:

-you need to be a people's person

-you need to not stress a lot

-you need to look long-term (10-20 years)

-you need to know the locale street by street/block by block

- you need to know the neighbors

-you need to know the local HA (make or break!!!)

-you need to have a good team on the ground

-you need to have access to non-traditional lenders (local initiatives banks/thrusts, local hard money lenders, even the city)

-you need to understand your exit strategy is another section 8 investor

-you need to be/think different

-you need to look for people looking for long term renting;

-you need to screen your prospective tenants like crazy

-you need to be respectful , understanding, professional and by the book/letter of the law+letter of your lease, all-at-the-same-time!

-you need to make the stock/units tough/reliable/nice at the same time (tough and reliable means less maintenance headaches later down the road)

-you need to standardize your units (paint/faucets/vanity/cabinets/etc etc)

-you need to have contacts with all major new/used appliances stores/dealers in the area

-the way to a woman's heart is nice bathrooms and kitchens!

-the second way to a woman's heart is a welcome gift package (about $10 in dollar tree supplies: toilet paper roll, cleaning paper roll, toilet plunger, toilet brush, dish dispenser, soap dispenser, shower liner) + 1 box/pack of water bottles

-the third way to a woman's heart is a nice home/unit smell (apple + cinnamon/santal wood/ebony....)

short version:

-you need to find your niche!

all the best and continuous success!