Hello. I'm reading this very interesting book entitled Section 8 Bible Volume 1 by Michael McLean.
In this book, Mr. McLean talks about something called preventive maintenance. His philosophy with section 8 landlording is if something is not required in a section 8 inspection, then remove it from the property. In his view, these items will break anyway and will have to be replaced. Replacing them increases maintenance costs and headaches.
His philosophy is to provide a clean and safe unit for section 8 tenants but doesn't have "amenities" that can break or increase costs.
If you remove them from the property before you have tenants, then, you won't have to replace them and the tenants won't expect them. The items he recommends for removal are:
- screen door
- washer/dryer and water hookup
- cabinet doors (he also advises boarding the cabinets)
- hose bibs on the front and back of the house (to decrease water costs and prevent tenants from having a car wash business)
- outlets under a window to discourage tenants from using a window AC unit
- He even goes as far as boarding windows that need to be replaced. He reasons only 1 window is required per room and the more windows you have, the more chances of it being broken by a baseball, etc.
I'd like to hear what you have to say about this approach. Thanks!
He apparently lives in a fantasy land where Section 8 tenants have no choices.
That is not true here, where Section 8 tenants can basically have their choice of units, and can and do shop around. I still haven't got one, and my houses are a whole lot nicer than what you are describing.
And several of the things you list are or could be against code. The water pips, for example, are required by code, and you can't remove an outlet if that makes the maximum run too long.
But if he is making money selling how-to guides on being a slumlord, good for him, I guess. Maybe he will be willing to co-market with me when I produce my guru series on how to make money stealing copper.
@Richard C. - I did think his advice was a little bit to harsh. But I wonder if there are some things that section 8 tenants don't expect. Like a dishwasher or a washer/drier? I wonder if a middle of the road approach is reasonable--don't eliminate all these things so that a property is still attractive but a eliminate some. I mean he does have a point, if an item is not present, then it won't break.
Here in Durham, a realtor told me there is a big shortage of section 8 properties so maybe there is not much choice.
There are places where a Section 8 tenant will expect, and get, granite countertops and new stainless appliances.
The only thing I have ever removed from a rental so that I won't have to deal with it breaking is a doorbell.
I read the section 8 Bible a couple years ago, however I do agree that some of the ideas being advocated are far from reality. Just like anyone else, Section 8 Tenants want to live in nice and decent places. Properties with boarded up windows will never pass the Local Village or City's rental inspections and definitely not section 8's Lately, Section 8 inspection now requires the unit to have working refrigerators and stoves for a unit to pass. In my opinion, that book was not worth the $20 or so that I paid for it.
With that said, while section 8 does not expect you to provide A/C or dishwashers, they still hold you accountable for providing safe and clean environment for your tenants. Landlord's rents can be abated and at worst be even kicked off of the program for these kinds of violations. In addition, you also cannot discriminate on what amenities you provide to your section 8 and regular tenants, they are paying rents too, regardless of who is actually paying it.
Finally, as a landlord, these units are your products, essentially your Brand which determine what kind of landlord you want to be. Of course some tenants will still tear up your property regardless, but most will appreciate what they have and keep it up for you.
There is a trade off however, the better your products, the less likely your tenants will want to move.
I provide these amenities and hold my tenants accountable for them upfront in my leases. This alone can reduce your turnovers.
I bought that book years ago, and found it very entertaining and fairly informative. I recall something about painting the floors gray?
I do agree with removing certain things that would likely be a problem. When we bought our first 2 SFRs in a Class C/D neighborhood, we replaced the ceiling fans with regular light fixtures. We didn't remove any screen doors, but when our first (and only) Section 8 tenant requested one, we said no. The house is very old and nothing is to standard, so it would have been a custom door. S8 didn't require it so she didn't get it.
Refrigerators are required here, though.
And that house did have the copper stolen while it was vacant, so maybe I can contribute to your guru series, @Richard C. ;)
I agree 100% with @Remy Balogun! We don't treat our Section 8 tenants differently than our other tenants. We provide amenities that will attract good tenants and we screen well. Our longest term tenant has rented the same apartment for 26 years and she is on the Section 8 program, takes care of the place and pays rent on time. We maintain her unit and do upgrades for her as we do upgrades for others. Its a win-win.
@Aly L - Yes. The author did mention something about painting the floor gray. He absolutely hates carpets! I was floored by that. I mean, I understood why it may be logical not to provide a dishwasher but painting the bedroom floor gray and be done with it?
I've painted floors and stairs grey in a finished attic before after the tenant destroyed the carpet
Makes perfect sense if the flooring is hardwood or plank and the property is in a less-than-desirable neighborhood where you are going to expect higher maintenance costs
A gallon of grey oil-based utility paint is only $17 at Lowes which makes it cheaper than other colors and just as durable
If I remember, he says he collects the rent in person while carrying a gun...so you can understand the kind of tenants he chooses to deal with.
I've seen landlords try this approach in my city and in some cases they have ended up in court over code violations. One neighborhood association in my area is even considering suing a couple of the larger slumlords. In general I think we should treat people how we would want to be treated. If we can't do that and make money then we should perhaps pursue another real estate or investment niche. I also think it's an investment in the future of our business. Tenant friendly laws wouldn't exist or would be less egregious if the Donald Sterlings of the world weren't allowing their tenants to live in standing water.
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