Section 8 Rent Increase

[Jose Gil]

Hi,

I recently started my real estate investing journey by house hacking. My current tenant is section 8. I reached out to the housing authority submitted my comps and requested FMR price of $1890. They got back to me saying they will do $1750 and showed me the lowest rents in the market. But realistically current market rent is higher.

This is my first time dealing with this can anyone help me?

thank you

[Ashish Acharya]

Hi @Jose Gil, you’re definitely not alone here. What you’re running into is very common with Section 8. As others mentioned above, housing authorities tend to base their decisions on the lowest rents they have on record, not always what the true market is doing right now. To get closer to it, you’ll want to resubmit solid, recent comps that truly match your unit (same bed/bath, similar size, same area), and clearly highlight any upgrades or features that justify a higher rent. You can also ask for a rent reasonableness review if you feel the number they gave you doesn’t reflect the actual market.

From a tax perspective, Section 8 rent is still taxed like any other rental income, even if it’s a bit below market. The upside is that you can still deduct all the usual expenses, mortgage interest, property taxes, repairs, maintenance, and depreciation, which can help offset that income. If the rent comes in lower than expected, it just becomes even more important to track your expenses carefully so you’re not leaving deductions on the table.

At the end of the day, steady cash flow gives you flexibility. If this rent works for now, that consistency can help you reinvest into something that fits your goals better, maybe another house hack, a higher-cash-flow deal, or even a different market or strategy altogether. And if you’re serious about scaling, working with a CPA who understands real estate can make a big difference long term so you don't miss out on opportunities and can plan ahead. Good luck and happy to connect!