All Forum Posts by: Marc Possoff

Ok the thing I see is when a neighborhood within the same zip gets gentrified then no landlords will do section 8.

As an example. Point Breeze is in the same zip. At one time is was bad and lots of section 8. Now that Point Breeze is gentrified I don’t see landlords section 8. It’s also likely that landlords that once sectioned 8 in Point Breeze either went non section 8 or sold and the new owner renovated and flipped or rent it non section 8. I know some investors in Point Breeze.  

Same can be applied our my property is. It’s becoming gentrified. 

Now one thing I noticed that the zip used to be Group 3. In the last couple years it’s now Group 5. 

I’m not sure what you’re saying per se. You said that people with vouchers want to take their vouchers to a better neighborhood like Point Breeze but Point Breeze isn’t necessarily a section 8 neighborhood now. 

So how would this play with our property? Better off not to section 8?

As I figured out expenses using 10% for repairs, 10% for capex and 10% for vacancy, and $100 / month for utilities(water) renting out at $1500 a month our cash flow would be $0. Since we didn’t have to lay out any money for down payment or repairs that figure is $0. Now at the section 8 rate of $2000 different story. 

I guess in the scheme of things if that’s the case of having no cash flow but not loosing money, there will be appreciation and a good chance of rentals increasing  like Point Breeze. 

Currently market value of house is about $225k. I we have a $65k mortgage on it. And my wife paid $1. 

@Michael Smythe can you elaborate?

Property is in 19146 zip which according to PHA, rentals are $2013 a month. But since I know the neighborhood(Grays Ferry) non section 8 rentals are $1400 - $1500.

Like to know how much rental we can get to figure this out. Figured out expenses to be $1500 a month.

Mortgage $575

Insurance $100

Taxes $125

Utilities $100

Repairs $200

Capex $200

Vacancy $200

We also own a vacant lot in the same neighborhood and wondering if there there was a way to leverage building on the lot and keep the house. 

https://www.pha.phila.gov/wp-c...

Thanks!

@Michael Smythe can you elaborate?

Property is in 19146 zip which according to this, rentals are $2013 a month. But since I know the neighborhood(Grays Ferry) non section 8 rentals are $1400 - $1500.

https://www.pha.phila.gov/wp-content/uploads/2023/02/HCV-Payment-Standard-Schedule-effective-October-2022_.pdf

Thanks!

Have property that we want to section 8. It’s a completely renovated house in Philadelphia in a zip that’s a class A but the neighborhood is probably a C. It’s starting to become gentrified. 

With section 8 do you need a property manager? Thanks!

Makes sense to go Section 8. Although Grays Ferry is in 19146 I still consider the neighbor maybe a C class. But no doubt that it will become an A. 

First question with section 8 I assume you don’t need a property manager?

Since the house is completely renovated we want to maintain it in the shape that’s it’s in. It’s basically a brand new house per se. With that being said we would want the tenant to report stuff that would need attention. For example like clogged toilets or sinks so they don’t overflow and cause water damage. The roof is new so shouldn’t have leaks but you never know and would like to know when a problem happens so we can get it fixed without causing more damage because it not addressed can cause more money to fix and further damage. 

For instance it will be bad if a toilet backs up and floods all over the place because tenant keeps trying to flush instead of letting landlord know before it gets to a point where it floods all over. Water is a bad thing if not addressed or cleaned up as quick as possible. 

As a section 8 landlord are we allowed to check the property once a month for issues? I wouldn’t be looking for cleanliness but looking for damage and / or tackling an issue that could get worse. 

As a section 8 tenant what are their responsibilities to report issues? 

I believe that a section 8 lease in Philadelphia is for 24 months. I understand if tenant doesn’t renew there will be some maintenance when vacant. But since everything is new I don’t expect major stuff. We will have an expense account and capex account. 

On the other hand is tenant wants to stay we would probably still like to do touch ups or whatever to maintain the property to keep it as close to brand new as possible. Understand there will be wear and tear for living in. 

I know I’m kind of spilling off thoughts in my head. 

Thanks!

 

If we were to go section 8 would we be entitled to high opportunity zone rental rate even if it’s in Grays Ferry?

Why is section 8 rent higher than non section 8? 

I have a property located in the 19146 area code Grays Ferry. It might be important to note that Grays Ferry and Point Breeze are the same zip code. Don’t know if that will be important with rental income. 

Completely renovated, 2 bedroom 1 bath, about 850 sq ft. Unfinished basement. Basement is low not enough for living space. Can dig out. 

Income: Non section 8 looks to be $1500 a month. Section 8 is $2013. 

Expenses:

Taxes $1500

Mortgage( $65k renovation) $7800

Vacancy 5%

Repairs 5%

Capex 5%

Property management 10%

Utilities $0 tenant pays 

Total expenses @ $1500 month rental $13,800

Total expenses @ $2013 month rental $15,339

There is $0 down payment, $0 closing costs, $0 repairs rehab(that’s in the mortgage). 

Need some help figuring this out. Thanks!

I have a 2 bedroom completely renovated that thinking about section 8 not sure. Don’t want to sell it though. 

One thing that scratching my head is, If section 8 rentals for a 2 bedroom are $2013, why is the market value for a non section 8 rental $1400-$1500 in Grays Ferry?

19146 area code includes Grays Ferry and Point Breeze. Prior to 2022 19146 area code was in group 4. 
 

Driving around Grays Ferry I’m seeing  a ton of new construction and renovations. 

I’m referring to 28th st - 34th / Grays Ferry Ave - Tasker. 

What’s anyone’s take on Grays Ferry?