Section 8 landlord
Hello everyone,
Recently I've been looking into the logistics of become a section 8 landlord. This was recommended to me by my agent based off of the class neighborhoods I'm interested in investing in. Based on budgeting, section 8 seems like a viable option without any major cons. If anyone on here has some experience or a good reason to stray away please reach out. Thank you all!
Troy,
Some landlords prefer Section 8 while others will shy away from it altoghether. I am a real estate broker and investor in the Cincinnati area. I have dealt with a many section 8 and non section 8 tenants over the years and got to the point where I didn't want to deal with section 8 anymore. While the rent is guaranteed, I learned that the maintenance issues far outweighed any rent guarantees.
Section 8 conducts yearly inspections which is great. Some issues are to be taken care of by the tenant and others by the landlord. If the tenant doesn't take care of their issues than you become responsible. 9 out of 10 times you become responsible.
I always conducted my own inspections well ahead of any section 8 inspections to get ahead of the game and fix any issues that may arise due to section 8 inspections. However, maintenance costs seemed to be never ending. There was always a leaky faucet, clogged toilet, broken light fixture, lost keys, overgrown grass, trash in the yard, etc. Many times the tenant would not pay their portion of the rent on time if at all.
Not trying to sway you one way or the other but just trying to give you my experience of 30+ years as a landlord and broker. Reach out if you have any questions!
These issues were less prevalent with tenants that were not on section 8.
Thanks for your insight Victor. When I'm analyzing a deal and accounting for future expenses, how much more do you think I should increase my repairs portion in my expenses for section 8?
My best advice is to get a double deposit. Section 8 is great because it is guaranteed income. Housing pays for sometimes 100% of the rent. A double deposit for someone on section 8 can be a lot but there are many programs that assist with deposit help. As stated by Victor, maintenance and cleaning when a tenant leaves can be brutal but this can be with any type of tenant. Good luck. :)
Quote from @Victor Patel:This is a great point. The section 8 inspections are something to account for. A lot of people are drawn to the guaranteed rent money but I found it comes at a significant cost and I did not think it was worth it. One thing I learned the hard way was that location matters and local laws matter. If you are in a “tenant friendly” location where the rules and laws are in your tenants favor and not the landlord, renting to section 8 can literally bankrupt you. I was in a jurisdiction that did not allow tenant evictions unless under certain circumstances and I had predator tenants that knew how to work the system and stay there for years without paying rent and I had a hard time evicting them. Go in with your eyes wide open.
Troy,
Some landlords prefer Section 8 while others will shy away from it altoghether. I am a real estate broker and investor in the Cincinnati area. I have dealt with a many section 8 and non section 8 tenants over the years and got to the point where I didn't want to deal with section 8 anymore. While the rent is guaranteed, I learned that the maintenance issues far outweighed any rent guarantees.
Section 8 conducts yearly inspections which is great. Some issues are to be taken care of by the tenant and others by the landlord. If the tenant doesn't take care of their issues than you become responsible. 9 out of 10 times you become responsible.
I always conducted my own inspections well ahead of any section 8 inspections to get ahead of the game and fix any issues that may arise due to section 8 inspections. However, maintenance costs seemed to be never ending. There was always a leaky faucet, clogged toilet, broken light fixture, lost keys, overgrown grass, trash in the yard, etc. Many times the tenant would not pay their portion of the rent on time if at all.Not trying to sway you one way or the other but just trying to give you my experience of 30+ years as a landlord and broker. Reach out if you have any questions!
These issues were less prevalent with tenants that were not on section 8.