To Section 8, or not to Section 8?

Question

Thomas S. · Answer

I have inherited welfare tenants in multi units. I have had to evict them all. Worse is the fact that regular  working tenants do not like having welfare tenants in the building.

Chris Mason · Answer

Since Section 8 is a federal thing that is implemented at the local level, I strongly suggest you focus on what landlords local to the real estate in question have to say. The devil is in the details, or in this case in the local implementation. Go to your local REIA & in this thread focus mostly on responses to your inquiry from folks in the same town as you.

Nancy DeSocio · Answer

Hi Mark,

I've only owned our MFR for two months, so take my advice with a grain of salt :)  First, just to clarify, properties themselves aren't deemed Section 8...it's the tenant that has the Section 8 voucher.  The property would need to pass the housing authority inspection to be sure it meets their requirements for a Section 8 tenant.

We inherited a Section 8 tenant and have had no issues.  She pays on time and follows the same rules as everyone else.  She recently called to ask if she can get a dog, and I told her she needs to sign a pet addendum and pay a $25/month pet fee, and she was so happy that we would allow for it.  Because I'm still inexperienced, I don't know that I'd go out and specifically look for tenants that are on Section 8, but I wouldn't turn them away either, as we would make them follow the same background checks and requirements as any of our tenants.

Good luck with your search!

Martin Goodenberger · Answer

I bought a place that was all section 8. 3rd floor tenants moved out fairly quickly. First floor tenant was great and she paid the majority of her rent - always on time. Low maintenance & good tenant. Second floor was a train wreck. Their portion of the rent was less than $50 and it was pulling teeth to get them to pay. Filthy, dirty people and they left it a disaster zone of filth and junk in their apt, a common storage area (that the previous owner "rented" to them, which they also stopped paying for) and the basement. Fortunately, we eventually got them out as the placed needed significant reno.

I haven't rented to section 8 again, but I'm not totally against it. If you're going for the higher end of rents, they may not qualify. Raising rents down the road could also be a challenge.

I haven't rented to section 8 again, but I'm not totally against it.  If you're going for the higher end of rents, they may not qualify.  Raising rents down the road could also be a challenge.

Brian Ploszay · Answer

I mostly do section 8.  There are discrimination laws in my city, so theoretically, a landlord cannot deny someone that has a section 8 voucher.

You can have a section 8 tenant, and no one would even know they are section 8.  It is the type of tenants that you bring into your building.  So, screen hard.

I like section 8 because working with lower income housing means a difficulty in getting rents.

Tim Winter · Answer

Section 8 is a great way to earn extra cash flow, and as previously mentioned in lean times, that is great. But keep in mind: while you can screen your tenants, you can't screen your tenants friends, family or associates.

What I mean by this is that lets say you screen a great elderly lady who's on section 8, great at upkeep on your place, never a bother, you get your above market rent on time, no issues from the tenant. Let's also say for instance her delinquent thug of a grandson comes over and visits frequently, with a group of his "friends" and eventually threatens the life of one of your other tenants, leading to many phone calls, police visits and filing reports, etc. How do you screen for such a situation?

I found you can't.

Todd Dexheimer · Answer

It depends on you market and location of the property. The good thing about section 8 is that you get paid at least a portion of your rent and you are helping out people that are in need. The bad is that often times you will find less care is being taken with your property, the Section 8 has inspections, which at times can be obnoxious and often times you are renting to tenants with no job or limited employment, so they are home all the time, causing more wear on your house.

During lean times, having Section 8 can be extremely valuable, during really good times, such as now, you can often get really good market rate tenants that pay more than section 8.

I used to do Section 8 and had a few good tenants and a few bad tenants. Now I do no section 8 and typically have good tenants, but still a few bad apples.

Jonathan Taylor Smith · Answer

My properties are mostly SF Houses & Townhouses or Townhouse-Style Duplexes, so no properties where one tenant's ceiling is another's floor. I believe this makes my properties more desirable and so I always have many prospective S8 and non-S8 tenants to chose from for each property, allowing me to select the best. I also inspect quarterly and follow my lease to the letter... No horror stories to date and I'll continue to add units, as well as manage units for others.

J.T.

Carlos Zapata · Answer

@Mark Woodring   you will have the good, the bad and the ugly as any normal tenant,  I have been a landlord for the 3 types already.  One  (the good one)  no compains in almost 5 years,  she pays on time (most of the time) her part of the lease,  one time I had a really bad tenant,  she was in her 20s with 5 kids and no job,  Housing authoirty was paying the 100% of her lease but anytime I was on the property she was with  some "visitors"     normally more than 5, after having osme discucions becasue she was not a clean lady I asked her to leave,  the good thing is she moved out without any legal action,

Be careful accepting the tenant,  even they are coming with the voucher,  you need to do your due diligence all the time,  credit score is not an issue but eviction yes

Good luck

To Section 8, or not to Section 8?

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