Connect with Section 8 Investors?

Question

Looking into purchasing a 4-plex in Denver as a house hack and considering having 1-2 units as section 8. anyone who has done similar strategy willing to connect?

Want to get better grasp of how much more I could actually charge for rent vs. market rate. Understand there is a ceiling put out by housing authority for max rent but want to know how realistic it is that they give you that price.

Wale Lawal · Answer

@Daniel Baran

The strategy I have observed produces successful results because Section 8 generates consistent long term rent revenue which usually exceeds half of market rental costs. The housing authority looks at local rent prices to figure out how much they will help with. If your place is good quality and similar to other places around you might be able to get a payment standard that matches what others are paying. It is a good idea to make sure the property meets all inspection rules. Just so you know the actual approved rent will be a bit lower than what you first asked for so keep that in mind and build in a little extra money.

Good luck!

Jeff White · Answer

@Daniel Baran Hi Daniel, that's fantastic that you are looking at a 4plex and house hacking it. It is a strategy that I've done with my wife 9 times in 8 years, so it is very powerful and you can live for reduced cost and sometimes for free if you do it correctly, and that's my favorite part of it.

Regarding the Section 8 question, I'm very familiar with Section 8 since I've down it on about 8 units total in my 20 unit portfolio in Denver, Aurora and Englewood, so I've worked with all the housing authorities and understand the program very well.

I would be happy to explain the program and how it works and how you can utilize it for a specific Denver property or in another city too.

Bo Smith · Answer

Section 8 in Denver can actually pay above market in some areas - I've seen payment standards hit $1400-1500 in certain zip codes where market rent runs $1200-1300. The trick is cross-referencing Denver Housing Authority's payment standard chart with actual rent comps by zip. Look for older neighborhoods near transit where Section 8 standards haven't caught up to gentrification yet. Which specific Denver neighborhoods are you eyeing for the 4-plex?

Ozan Somunkiranoglu · Answer

@Jeff White  Hi Jeff,I’m also interested in investing in the Denver area, specifically focusing on Section 8 housing.

Which areas have worked best for you so far? And are you primarily investing in single-family homes or multifamily units?

Happy to learn from your experience — feel free to DM me as well.

Frank Pyle · Answer

You can make Section 8 work in a Denver 4 plex house hack, but don’t assume it pays more than market unless your unit specs line up with the payment standard and you can hit the rent reasonableness test. Quick checkpoint is pull your neighborhood market rent, then compare it to the current Denver Housing Authority payment standard for the right bedroom count, then back out your tenant portion and see what the total contract rent would actually be after utilities. The ceiling number is real, but getting the max usually means your unit is clean, updated, and you are priced in line with similar rentals they approve, otherwise they push it down. Best move today is call the housing authority and ask what they are actually approving lately for your zip and unit size, then talk to two local S8 landlords and see what their last three contracts came in at. What bed and bath mix is the 4 plex and are utilities separately metered or included?

Chad Rocke · Answer

Hey @Daniel Baran - Happy to chat more. I have 9 doors some in state and some in WI. Let's grab a cup of coffee or lunch. If you want to put some time on my calendar I will send you a DM. Look forward to connecting.

Connect with Section 8 Investors?

Most Popular Reply