Do you accept Section 8 Tenants

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Do you accept Section 8 Tenants

Kenneth GarrettPro Member
Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes

I am asked on my rentals if I take Section 8 tenants.  I never say no, I always say it depends on the financial numbers.  I have never had a Section 8 tenant apply.  What has been your experience with Section 8 tenants?  

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Gail K.
Augusta, GA · Member since 2014 · 1k+ posts · 1k+ votes
9y

We no longer deal with this program.  We did once.  Even with clients in the program who are employed we found this was not the best choice for us.   You might rent to say, a four member family only to find that, later, they have allowed unemployed relatives to move in with them greatly increasing the wear and tear on your property. 

In our case adult female children had a tendency to pop out offspring as if they were a PEZ dispenser, often producing a child with every man they casually dated, then dropping off the children at "grandma and grandpa" to raise.  When  questioned about this ever increasing population one is often told these little ones are "just visiting"...until you happen to see them being dropped off by the local school bus one afternoon and realize they are now permanent residents in your rental property.

If you choose to work with this program it would be important to monitor who is actually residing in your rental property carefully.

Gail

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  • Patti RobertsonBusiness Member
    Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
    9y

    @JD Martin - As someone who manages 100 SEC 8 properties, I have to say your post made me chuckle.  One of the requirements of SEC 8 is that the participant has to be working - unless of course they are disabled or retired.  I personally only select SEC 8 tenants who are working full-time or close to full time at the time they apply.  Otherwise, SEC 8 won't pay the high market rent amount I am asking. 

    I find that people who are closed minded and negative about the program either tried it decades ago (before technology allowed some of the controls we have today to be in place) or they tried it on a small scale and were not proactive about protecting themselves when something went wrong.  

    In the lower end neighborhoods I find it is almost impossible to find a tenant who has reliable, verifiable income of 3 X the rent. I would much prefer to take my chances with a tenant who has the safety net of HUD to kick in rent payments if they lose their job than to accept a tenant who will have no option when they quit their job or get laid off.

    I recently published a blog on the subject of people's perception of SEC 8 vs my reality.  Here's the link of anyone wants to read it. https://www.biggerpockets.com/blogs/9232/55313-intro-to-section-8---your-perceptions-vs-my-realities

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  • JD MartinBusiness Member
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    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    9y

    ^^^Response:

    1. I don't rent to marginal tenants, so that already excludes most people that would qualify for section 8.

    2. I don't own in low end neighborhoods, so I don't have to worry about attracting marginal income people.

    3. You do not have to be working. You have to agree to work, but lots of people have significant gaps in employment and do not lose their section 8; I know this because I have relatives on section 8. They may be more lenient for people who are laid off, or like my relatives, have kids, but it isn't true that as soon as you aren't working that they kick you off.

    4. I don't want to deal with bureaucratic things like paperwork or inspections.

    5. I have a healthy rental market and don't need to deal with Section 8, so I'm not going to. By definition Section 8 people are very low income, and I'm not interested in dealing with people that close to the edge. Wrong or right, that's my position.

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  • Randall Brown
    Investor · Santa Cruz, CA · Member since 2016 · 71 posts · 39 votes
    9y
    Originally posted by @Heather Walton:

    even though the FMR in my area is about $1,100 for a 3 bedroom section 8 would only pay about $800. Have any of you experienced this?

    Yes, same here in most except the lowest quality locations.  

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  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    9y

    I have 3 Section 8 rentals. For all my rentals, the tenants all have jobs (even one does work at McDonald's, but it's still a job).  It is true that in different states/counties/cities there are different regulations. In my area, it's okay to say "we do not accept section 8". In other cities/states, it's not legal to do that.  There are actually many landlords in my area who put that in their ads.

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  • Patti RobertsonBusiness Member
    Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
    9y

    @Randall Brown - This really shouldn't be the case unless the tenant has no income. Even when HUD budgets are cut, most HAs keep rents at 100% of market rent because they know if they don't they will lose the landlords. What SEC 8 will pay depends on a combination of market rents, how energy efficient the house should be, and the tenant's income. I wrote a blog that explains this and give tips on maximizing your rent. You can read it here. https://www.biggerpockets.com/blogs/9232/55313-intro-to-section-8---your-perceptions-vs-my-realities

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