I am under contract to purchase a few properties in southside of Chicago, aiming for section 8 tenants. It's my understanding that the property needs to pass CHA (Chicago Housing Authority) inspection. Anybody know what items are problematic for them? i.e. older roof, water heater, balusters not to code, absent GFCI, etc.?
CHA will inspect mainly the inside of the property. I stopped doing section 8 because of the things they would fail you for, and it's usually things the tenants do to damage the property. Good luck with that. What area are you purchasing? Why not purchase north side properties for section 8 tenants?
Hey @Patrick Britton ! CHA looks for everything that you mentioned in addition to a few other things.
- All Windows must open and shut properly
- All owner supplied appliances and utilities must work correctly
- Knock-Out plugs must be installed on any exposed Light/Power Outlet/Junction Boxes. (Typically in the basement)
- Chipped or Peeling paint
- If you have an HVAC system, exhaust must be properly installed (No spaces or Cracks)
- Smoke/Carbon Monoxide detector must be within 10ft of bedrooms, stove, and Furnace
- No sharp objects, including on the exterior of the property
- Any area that the tenant does not have access to must be sealed or locked (Crawl Space, etc.)
Everything else is typical habitable property stuff like locking doors, running water, heat, etc. I just recently had a annual inspection and a new move-in inspection that I passed on both of the initial inspections, its not difficult at all. If you fail a item on a annual or semi annual inspection that is the tenants responsibility, then CHA will require them to make the repair after a certain amount of time. If you do inspections yourself or hire someone to do inspections once every 6 months or so and catch issues, then you can get the repair done, bill the tenant, and wont have anything to worry about for inspections. The tenant typically does not want to fail an inspection just as bad as you don't. Make sure to screen consistently, and do not be afraid to hold out until you find the right person. It took about 2 months, and about 9 individuals were turned away after my last rehab before the current tenant was placed. Be patient! The inspection is the easy part, finding the right person is the crucial/most important part!
Hope this helps!
@Mark Ainley , Anything to add?
My suggestion would be for you to attend an Owner Briefing, which as far as being a gov't run event was extremely educational, but I see you are out of state. Therefore I really really suggest engaging with a property manager familiar in section 8 here in Chicago to discuss your prospective properties. A lot of garbage gets sold on the south side to out-of-towners with crazy claims that they will qualify for sec 8 as-is, or rents that are way higher than a realistic rate, so you really need someone familiar in the exact area you are looking who only has your interests in mind. There are a lot of marketability factors not dependent on passing the CHA inspection to take into account.
Ouch ! almost everything is problematic for the good folks at CHA. They are tough to deal with. My PM told me he had a conversation with a CHA inspector on a recent visit. It was more of a plead to pass the unit rather than an conversation actually (and these apts are nice) CHA guy told him he is pretty much expected to fail a unit first time round or the boss will think he is not doing his job right. i.e find something to fail.
Its way more detailed than you would think. Cracked tile, chip on the countertop, loose fridge seal, cracks in sidewalk, old caulk are some of the things that come to mind over the years. And yes the bigger code issues like handrails and GFI's etc.
New homes might pass easier..but some of these 100 yr old buildings in Chicago are naturally a bit more worse for wear.
@Patrick Britton Have you looked up the CHA website ? Am pretty sure there must something on there about inspections. I attend a lot of the CHA/Owner meetings. All is calm at the meetings between the CHA and the owners until the topic of inspections comes up. Then all hell breaks loose.