Section 8 real estate

General Real Estate Investing
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Section 8 real estate

Jaime Zarate
Member since 2024 · 11 posts · 10 votes

So I recently came across the idea that I can buy a house and market as a section 8 house and get a tenant guaranteed and get money guaranteed from the government. Can anyone care to explain how to get started in this like setting up the house as section 8 I'm very confused?

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Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
7mo
Quote from @Jaime Zarate:

So I recently came across the idea that I can buy a house and market as a section 8 house and get a tenant guaranteed and get money guaranteed from the government. Can anyone care to explain how to get started in this like setting up the house as section 8 I'm very confused?


 If it's too good to be true - it is!

Don't be this gullible!

Check out all the other posts here on BP.

[email protected]248-209-6824
Logical Property Management4.9451 Reviews
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  • Kenneth GarrettPro Member
    Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
    7mo

    @Jaime Zarate

    You need a potential tenant who has a voucher. Once you have a voucher applicant you can then apply to be part of the program. Depending on application process and the office you are working with, it can take 1-2 months to get through the process. Once you are approved an inspector will be scheduled to conduct an inspection. You must pass the inspection. If you fail, you will need to make the corrections and schedule a re-inspection.

    You can find a copy of the HQS inspection on a simple google search.

    The applicant in general pays a portion of the rent, the rest is paid by the government. In some cases they pay 100% of the rent.

    You can use your lease. They will review your lease to make sure it complies with all laws.

    You can contact your local housing authority office to find the rent numbers based on bedrooms or on the huduser.gov site.

    0Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    7mo
    Quote from @Jaime Zarate:

    So I recently came across the idea that I can buy a house and market as a section 8 house and get a tenant guaranteed and get money guaranteed from the government. Can anyone care to explain how to get started in this like setting up the house as section 8 I'm very confused?


     If it's too good to be true - it is!

    Don't be this gullible!

    Check out all the other posts here on BP.

    [email protected]248-209-6824
    Logical Property Management4.9451 Reviews
    WebsiteView Page
    2Reply
  • Janice Carter
    Real Estate Broker · Atlanta · Member since 2024 · 1k+ posts · 605 votes
    7mo

    Accepting Section 8 Housing Voucher doesn’t mean you “set up” the house differently. It means you rent to a tenant who has a voucher through their local housing authority.

    It is important to note that it is not automatic or guaranteed. The unit must pass inspection, rent must align with local fair market rent and payment can be delayed if paperwork isn’t handled properly.  Once approved, the government pays its portion directly to you and the tenant pays the remainder.

    0Reply
  • Kerlous TadresBusiness Member
    Realtor · Columbus, OH · Member since 2023 · 1k+ posts · 1k+ votes
    7mo

    @Jaime Zarate, I recommend you call your local Section 8 office first to ask what rent they allow and what the home must have to pass inspection. Then you buy a normal rental, fix it to meet their safety rules, and rent it to a tenant with a voucher so the government pays part of the rent to you.

    [email protected]614-490-1163
    Kerlous Tadres | Reafco Real Estate539 Reviews
    WebsiteView Page
    1Reply
  • Eric FernwoodBusiness Member
    Realtor · Las Vegas, NV · Member since 2014 · 992 posts · 1k+ votes
    7mo

    Hello @Jaime Zarate,

    Section 8 sounds like guaranteed income—no fuss, no muss. We’ve had a few clients try Section 8 and the results were disastrous. Note that I am writing about Section 8 in Las Vegas, where you are considering investing may be completely different.

    The situation in Las Vegas

    • "Guaranteed" income: Not quite. The government typically pays 80% while the tenant pays 20%. Clients who've tried Section 8 report they almost never receive the tenant's 20% portion. When I asked a property manager I respect whether we should evict these tenants, she said there was no point—Section 8 tenants rarely pay their 20%.
    • Maintenance costs: Clients with Section 8 properties regularly complain about high maintenance expenses. Section 8 performs inspections, and if anything doesn't meet their requirements, your payments stop. Some tenants use this as leverage to get what they want. For example, one tenant demanded all new stainless steel kitchen appliances. The owner refused. The tenant then systematically broke windows and reported the damage to Section 8. The owner had to replace the windows to resume payments. The tenant broke them again. This cycle of property damage and Section 8 complaints continued until the owner finally installed the stainless steel appliances. Significant property damage is common with Section 8 tenants.
    • One client rented a single-family home through Section 8 for $50 more per month than market rate. He bragged about the extra income. After a year of high maintenance costs—largely from vandalism—he chose not to renew the lease. Once the tenant moved out, restoring the property to livable condition cost him over $15,000.
    • A client who had purchased multiple properties from us and made good money attended a real estate convention where he learned that the secret to great wealth was multifamily properties with section 8 tenants. To make a long story short, he's in bankruptcy now due to the losses from these properties.

    You need to do research where you plan to invest and not listen to the opinions of others. I recommend talking to multiple property managers who are managing section 8 properties and getting their read on the situation. Perhaps it is totally different than what happens in Las Vegas.

    [email protected]702-358-8884
    FERNWOOD Team, KW VIP Realty520 Reviews
    WebsiteView Page
    1Reply
  • James JonesPro Member
    Investor · Collierville, TN 38017 · Member since 2017 · 592 posts · 445 votes
    7mo

    There are two big misconceptions in your post that you need to clear up first:

    The tenant is not guaranteed.

    The rent is not 100 percent guaranteed.

    Section 8 can be very strong, stable income. But it is not automatic money.

    Here is how it actually works.

    Step 1: Buy the property like any normal rental

    There is no special “Section 8 house” you purchase. You buy a property that makes sense as a rental first.

    Location still matters. Condition still matters. Numbers still matter.

    Step 2: Make sure it meets minimum housing standards

    Before a voucher tenant can move in, the property must pass an inspection by the local housing authority. This is called an HQS inspection.

    Common fail points:

    • Peeling paint

    • Broken outlets or missing cover plates

    • Leaks

    • Missing handrails

    • Safety issues

    If it does not pass, you fix it and reschedule.

    Step 3: List the property and accept voucher tenants

    You do not “register the house” in advance in most markets. You list it like a normal rental and advertise that you accept vouchers.

    Voucher holders apply like any other tenant.

    You still screen:

    • Background

    • Rental history

    • Income portion they are responsible for

    The housing authority does not choose your tenant. You do.

    Step 4: Request for tenancy approval

    Once you approve a voucher holder, paperwork is submitted to the housing authority.

    They:

    • Review rent reasonableness

    • Schedule inspection

    • Approve contract

    Step 5: Sign a Housing Assistance Payment contract

    After approval, you sign a contract with the housing authority. They pay their portion directly to you monthly. The tenant pays their portion.

    Now the important part.

    The government guarantees its portion of the rent as long as:

    • The unit stays compliant

    • The tenant remains eligible

    • The contract remains active

    It does not guarantee:

    • The tenant’s portion

    • No damages

    • No turnover

    • No vacancy

    You can still have eviction. You can still have inspection issues. You can still have turnover.

    Why investors like it:

    • Consistent government portion

    • Often strong demand

    • Annual rent adjustments in many areas

    Why investors struggle:

    • Poor screening

    • Not understanding inspections

    • Buying in bad micro locations

    • Letting properties decline

    If you want to start:

    Call your local housing authority and ask:

    • What are payment standards for 2 bed, 3 bed, etc?

    • What is their inspection timeline?

    • Is there high demand?

    Run the numbers conservatively

    Do not buy assuming 100 percent of rent is covered.

    Treat it like a business

    Clean units. Clear rules. Strong lease enforcement.

    Section 8 is not magic. It is just a tenant pool with a government subsidy attached.

    If you operate well, it can be very stable.

    If you operate poorly, it can be very painful.

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