I just did two things I always try to avoid - I inherited a Section 8 tenant
I really hate taking other people's tenants, especially in single family homes, because I really like to do my own screening and I like to set my own terms for how everything's going to work. When they're already in the place with a valid lease it makes it harder on me. I also like the ability to go into a vacant property and get everything fixed the right way without working around a tenant so I know it's all done and we can avoid a lot of service calls.
In general I really dislike Section 8, I've encountered some pretty terrible entitled people in the program that treat the property like something they got for free. Yes, I know there are good people on Section 8 but the majority I have seen in this area are not people I would want as tenants. I also hate the bureaucracy of the whole thing (their paperwork, inspections, their ability to abate rent and their own discretion, etc).
An agent I've done a lot of business with in the past came to me with a deal on a property that has been rented to the same Section 8 tenant since 1991, she's been there 23 years with 3 different landlords. I have a copy of the original 1991 lease in my possession and she's been on Section 8 since the first lease. The property is a REO and the bank offered her $3,000 to move out. She turned down the money and chose to force the bank to honor her valid lease under the tenants in foreclosure act because she loves the house and plans to stay there until she dies (she's only in her 50's now). The asset manager asked the listing agent if she could find an investor willing to buy the property and keep the tenant in place to avoid listing it and dealing with people trying to do showings and inspections with the tenant there.
I did a walk through of the property with the tenant, the agent and my contractor and agreed to put in an offer on it. After a month of waiting on the bank to have an appraisal done and a little back and forth on the price I was able to get it under contract at $16k (market value is $30k). The house is rented for $850/month and I'm going to need to do about $3k in work to catch up on some deferred maintenance. Using the 50% rule and factoring in the deferred maintenance it'll be a 22% return.
I guess it's worth it to bend your criteria every once in a while when the deal's right. The last tenant I inherited has worked out so far - another woman who had been renting her house for 19 years (self paying). That one was in foreclosure had a sale date set but with the help of an attorney with the title company we were able to get a short sale done prior to the sale to keep her in place. She had an expired lease that had gone month to month and the bank would have forced her out. Two years later she's been a good tenant and still pays her rent on time.
The downside to such long term tenants is when they move out you are left with a ton of updating to do in order to re-rent the place because you know nothing other than basic repairs have been done during that time. The biggest upside is it's great feeling to be able to keep a person in the house that has become their home when it has become a distressed situation through no fault of their own.