Section 8 Feedback
I am considering buying my first section 8 property. The asking price is $70,000, the property has been totally rehabbed has a section 8 tenant who pays a small portion of the rent while the section 8 office picks up the majority of the rent. The property cashflows about $400 per month. I am looking for feedback from investors who have dealt with section 8 properties. I am getting conflicting advice on whether renting to section 8 tenants is the way to go or not. Any advice you could provide on what else I need to consider would be appreciated.
Hi bmcmaha,
I was a property manager for 4 years in Las Vegas. I managed a few low-income apartments that had a few section 8 tenants. 1st get a copy of the Housing Authority Rules both for you and the tenant to follow. Not the same as landlord-tenant law. I have had situations w/tenants that would damage a place then the owner paid to fix it, to meet section 8 guidelines. Also "boyfriends" don't live there (against sect.8 rules), although everytime I went to the property they are there??!! Hope that helps.
Everyone of my properties has at least one section-8 tenant. I get a 1099 at the end of the year. I have been an investor since my first duplex in 1988 that was owner occupied. I have never had a problem with any of my section 8 people. They all love their house and actually treat it as their own. Many investors I know have problems. The houses are in beautiful shape when they move in and they keep them that way. I get paid every month in one check.
The house must pass an inspection once a year, usually I always need batteries in the smoke detectors nothing more. I do know some people keep their houses trashy and never pass inspections and they don't get paid by the tenants.
I just bought another duplex and I'm getting ready to list it with Section 8 today.
Good Luck
Lori
[addsig]
My first Section 8 Property I bought (back in '89) had a nightmare tenant. I swore I would never go Section 8 again. Well last year I just bought and rehabbed a property and have it rented Section 8 and have to say, maybe I am just "lucky", but have a great tenant who keeps the place nice and my rent check comes the first of every month.
It's a good thing!
Take a tour through the Landlord Forum. There are quite a few topics which address Section 8 landlording.
things to consider
1.a tenant who rents at a minimum of 30% discount wants
to keep his discount. he'll probably keep the house reasonably well.
2. if he stops paying atleast the government portion keeps on flowing while u evict him.
i have a duplex and a house in N/C
section 8 in the house, great family, takes care of place, the wife is going to school for nursing, will be done in a month or so and has a job lined up at hospital, the yplan on being long tearm tenants
in the duplex, the 3 bed rm unit has section 8, nice lady with 3 children.
the other half i had to ask the regular tenant to leave, constantly behind in the rent, left it a mess in the process of remodle, when ready, i will look for section 8 tennant
I have been using Section 8 Tenants since 1990. I have had no problems with any of them. I require three background checks before I will rent to anyone, a credit check, unlawful detainer and bouncing check. When the prospective tenant gives me a Application to Rent, I also get a check for these three background checks (approximately $45).
I require the applicant’s income to be three times the monthly rent (same as open market).
Inspections by Housing Inspector used to be on a yearly basis. About two years ago they switched to every six months.
I have owned government(section 8) houses since 1979. Some of the tenants were inherited from the previous owners. You will find that your tenants stay longer,my average is 8-10 years. The best part is most of the rent is guaranteed. As with all rental property be selective in tenant selection.
I got out of the section 8 business cause I just got tired of dealing with the bureacrats that run the program. In Chicago that means the CHA. I never had that much trouble with the tenants. I once had the CHA back bill me for a 10 months rent (and stop paying all the other section 8 rents in that building) because somebody confused two dates on a form. The move-in date and the date of death of the tenant. CHA concluded that the tenant had died 10 months before she did and that they had paid the rent for 10 months on the aparment after she was dead. Took almost 8 months to straighten it out.
Then again, I eventually gave up on residential management altogether concluding it was just too much hassle. Now my commercial tenants and i get along just fine.