Section 8 - Single vs. Multi-family housing

[James Bavaro]

Hey everyone, 

About to be a first time RE investor here, as I just got an offer accepted on a multi-family property. My plan is to target section 8 renters. The property is a 2bed/1bath over a 3bed/2 bath duplex. I've completed tons of research/due diligence. The numbers work, as it cash flows nicely given the section 8 rental standard payments for the zip code of the property. 

I had just come across a section 8 strategy video on youtube of a very well-known and successful investor who actually recommended not using multi-family properties as housing for targeting individuals with section 8 vouchers for various reasons...and now I'm afraid!!!

Could anyone provide some insight/advice? Any feedback is much appreciated.

Thank you in advance!

[Glen Wiley]

When dealing with tenants and especially low income tenants here are a few thoughts based on 20 years experience and a few evictions:

1. Do NOT get soft with late rent. If they are late more than 5 days, start the eviction process. Many of the low income folks I have rented to are pros at "working the system" and will bleed you dry. It sounds cold, but you are running a business, you provide a service that they agreed to pay for. If they can't pay, remove them.
2. Charge late fees and stick to it. This is a kindness to tenants. Once they know where the boundaries are they are more likely to stay on track.
3. Ignore credit ratings but ask them to explain what you will see during a credit check. If they lie to you, do NOT rent to them.
4. Do a background check, if they have judgements for non-payment of rent, do NOT rent to them. If they burned a landlord before, they will burn one again.

Be kind, be understanding but be firm.