Does anyone have some input on putting a property on Section 8, I've heard good and bad things....Please advise...Thanks
There is a lot of paperwork and effort involved but you get a guaranteed income from the state.
The bad news? In my experience, a large percentage of Section 8 tenants are not good tenants. I have one tenant that is severely disabled and she deserves assistance. I have other Section 8 tenants that are fully capable of working but they refuse. They eventually create problems.
My last one was a single mother of three. Her rent was over $1,000 but she only had to pay $25. Yes, $25. Despite this small amount, she was regularly late. Then we discovered she was working and getting paid under the table so HUD wouldn't find out and cut her benefits. We kicked her out and she left us with cleaning and repair charges totaling about $2,000.
I think some folks have had experiences with Sec 8 tenants that are negative. And many that are positive. There is more red tape to get going, and annual inspections and such. I know investors that solely target Section 8 and are happy with their choice. There are good tenants and bad tenants everywhere. Typically, Section 8 housing would be offered in places where the tenant pool would be lower income anyway. If your investing in these areas, then it goes you’d likely have the same issues arise Sec 8 or not. The bonus is… You get a guaranteed deposit into your account on the 1st of every month without excuses and stories (most of the rent amount).
Also, to qualify for Sec 8, the tenant must be screened to some degree. Then you can still screen them through a legal set of criteria as well.
My opinion, it’s not Sec 8 that makes a bad tenant. A bad tenant is a bad tenant regardless. That said, I’m willing to put up with a little more degree of difficulty for an automatic check.
Depends on your goals, risk tolerance, investing area, etc. Sec 8 has been good for me so far. I’m sure I’ll have problem tenants eventually. But isn’t that part of the game?
You asked what needs to be done to get the property on sec 8. First, I would ask your potential renter if they actually have a voucher, or if they just went through orientation, or are on a waiting list. After u verify that they are on the program and have a valid voucher, contact your local HUD to get your inspections done. If they find something wrong, they will reinspect or in certain cases let you self certify. Then make sure you have your account properly set up with the housing authority and they have your tenants move in date, so u will get your check from them.
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