All Forum Posts by: Jennifer Donley

@Clifford Charles Congrats on the purchase.  I only do Section 8 rentals in the St. Louis area and love Section 8.  

Every Housing authority operates differently so I think your plan is good.  Also, here, our HAs are easiest to contact by email.  They won't take anyone in their offices anymore even if we wanted to schedule an appointment.

I obviously know nothing about your HA but I work with 2 here and the name of the game when it comes to rent increases is to Shoot The Moon.  They don't have rules around a maximum per year, they are only checking to see if the requested rent is "reasonable" for the area based on other rents in the area.  And in general, they give us as much as they can up to how much was asked.  So for instance, if they could give $1000 in rent based on the rent reasonableness test (comps) but I only ask for $950, I'm getting $950.   So I figure if I get the rent I asked for on an increase, I didn't ask enough.

Good luck!

@Rory Coyle this is great to hear - congrats!  I only do Section 8 rentals and highly recommend them.  They are the most stable and profitable rental niche out there when done right, in my opinion.

I've purchased some units with S8 tenants in place and I'd recommend submitting the new owner paperwork to the Housing Authority immediately following the close of the purchase.   Then follow up relentlessly until the office confirms they've made the switch in their system to make you the landlord.  Also don't panic if the first payment gets messed up - the HA will fix it and pay you in arrears (this shouldn't be a problem but just in case).

If you haven't already, I'd recommend requesting the most recent "notice of change" or annual recertification for the S8 tenant (a document that comes from the Housing Authority) that lays out how much the tenant pays and how much the HA pays.  As well as a ledger for both.

Lastly, I'd also recommend finding out the last time a rent increase was requested and what your HA office's process is for those. In my experience, a lot of landlords miss the opportunity to raise rents for S8 and it's usually a very easy process.

Reach out if I can help further!

@Sakib J. sounds great, there are tons of opportunities in St. Louis. Cash flow positive isn't too hard to find, depending on what you're looking for.  Let me know if I can help further.

@Jeremy Bohm, we have several great hard money lenders in the St. Louis area.  FasterFunds, Core Properties, Three Doors and Longhorn Investments are just a few.  I'd recommend a convo with each of them to determine their guidelines.  I know FasterFunds best and they are in the business of funding good deals and will help you make sure you don't get into a deal you can't get out of.  I've good things about the others as well.  Also, I'd recommend getting connected to the local REIAs, there are a ton.  Also joining the StL real estate investor groups on Facebook, there's a bunch of those too.  Let me know if I can help further.

I don't have a recommendation for a PM but would recommend asking a lot of questions of any companies you vet regarding their tolerance, process and appetite for Section 8.  Here, there are a lot of PM companies who will manage Section 8 properties and almost none of them do it well.  

Asking them some basic questions will help you determine if they know what they're doing:

-What percentage of their properties are Section 8 and/or how many Section 8 properties do they have?

-What specific processes do they have in place for Section 8 (it has additional paperwork and rules)

-What is their average turn time between 2 Section 8 tenants

-How & when do they request rent increases with the PHAs

-How do they keep the rent ledgers for Section 8 tenants? (They should keep 2 separate ledgers - one for the tenant and one for Section 8 - otherwise, the ledger is a mess and it gets difficult to tell who owes what)

-How long is it typically between when they place a Section 8 tenant and when the rent starts to come in (Here, it should only take 2 to 4 weeks)

-How does the screening process change when screening a Section 8 tenant?  (They may/probably should have something different in place around Income/Source of Income to pay rent/income multiples)

If they can't quickly & clearly answer these questions, I wouldn't recommend going with them.  Section 8 is amazing when done right but it is quite different than market tenants in a lot of ways and PMs without the knowledge and experience will cost you.

@Seth Wilcock Congratulations in your deal! I’m a St Louis native and a buy and hold investor as well. I sold 2 of my properties on Roofstock this year, I’m a fan of the platform.

Everything bad you've heard about Section 8 rental properties is wrong.  DONE RIGHT, Section 8 rental properties are the most stable and profitable rental niche out there.

I've built a portfolio of strictly Section 8 rental properties with great tenants, high rents, cared maintained properties, and $0 in past due rent.

All of this means I get more cash flow per door than anyone else in my market, and now I teach others how to do the same.

Learn how you can be successful with Section 8 properties and put your plans for financial freedom on the fast track.

Contact me, Jennifer Donley, the "Queen" of Section 8 at [email protected] to learn about our coaching program options or visit my website at www.section8educate.com to learn more.

@Lemarr Chambers I don't disagree with what the others have said.  For me, if the house is well cared for, the rent is paid and there aren't other issues or violations, I don't mess with it.  I think it's a matter of dealing with it in whatever way suits you & your business best.

Also realize that this can and will be an issue in any tenant segment, whether they pay their rent through Section 8, their own income (market tenants) or their parents' money (student housing).  I think we find it more bothersome or offensive when the tenant is on Section 8, and I understand why but I always try to remember that I would deal with it anywhere.

@Sami Gren, I use forms from ezlandlordforms.com for my tenant facing documents and they have an addendum.  You just put in the items that are different than the current lease, referenced by paragraph number or page number, and note the changes.

@Oleksandr Ivanovskiy I think it's a great idea.  Done right, I believe Section 8 is the most stable and profitable niche out there.  I have 26 Section 8 properties and the tenants are easy to work with and take care of the properties.  I aim to provide one of the best units in the neighborhood and am able to get a lot of interest quickly.  I screen meticulously and pick the best applicant.

I love Section 8 for 5 reasons - Guaranteed rent, Higher rent (in my areas, which are B & C neighborhoods in the St. Louis area), long tenancies, Section 8 rules &  processes (which help ensure higher rents & good lease compliance from tenants) and supply/demand gap (lots of demand for Section 8 units and low supply), which helps me attract and retain the best tenants out there.

Let me know if I can help further and good luck!