All
Members
Companies
Blog
Forums
Podcast
Webinars
    User Log in  /  Sign up
  • Forums
    Newest Posts Trending Discussions Followed Forums Real Estate News & Current Events General Landlording & Rental Properties Buying & Selling Real Estate Deal Analysis See All
  • Education

    Read

    BiggerPockets Blog BPInsights: Expert Analysis Guides Glossary Reviews Member Blogs

    Watch

    Webinars Video Library Financial Independence Blueprint Intro to Real Estate: Rentals

    Listen

    BiggerPockets Real Estate Podcast BiggerPockets Money Podcast BiggerPockets Business Podcast Real Estate Rookie Podcast Daily Podcast (Audio Blog)

    Topics

    Business Operations Finance Finding Deals Property Management Property Types Strategy
  • Network

    Recommended Vendors

    Real Estate Agents Mortgage Lenders Hard Money Lenders Insurance Contractors Investment Companies Build Your Team

    Search

    Members Events Jobs
  • Tools

    Calculators

    Rental Property Fix and Flip BRRRR Rehab Estimator
    Wholesaling Mortgage Payment 70% Rule Airbnb

    Services

    BPInsights: Property Insights Tenant Screening Property Management Lease Agreement Packages

    New Feature

    BPInsights (beta)

    Quickly analyze a property address or ZIP Code to compare your rent in your neighborhood.

    Analyze a property
  • Find Deals
    Real Estate Listings Find Foreclosures External Link Ads, Jobs, and Other
  • Bookstore

    Real Estate Books

    Profit Like The Pros Bidding to Buy See all books

    Featured Book

    BiggerPockets Wealth Magazine book cover
    BiggerPockets Wealth Magazine

    Written by financial journalists and data scientists, get 60+ pages of newsworthy content, expert-driven advice, and data-backed research written in a clear way to help you navigate your tough investment decisions in an ever-changing financial climate! Subscribe today and get the Oct/Nov issue delivered to your door!

    Get the Magazine
  • Pricing
Log In Sign up
User
Quick search links
Podcast Hard Money Lenders Books Washington
ForumsArrowMaryland Real Estate Q&A Discussion ForumArrowAre Section 8 Payment Standards Real?
  • Newest Posts
    • Newest Posts
    • Unanswered Discussions
  • Trending
    • Top Discussions
    • Trending Discussions
  • Browse Forums
Search Nova
Create post

Are Section 8 Payment Standards Real?

10 Replies

  • Share on Facebook
  • Share on Twitter
  • Share on LinkedIn
Rotate Log in or sign up to reply
user profile avatar
  • Posts 33
  • Votes 26

Tiana O.
Rental Property Investor from Washington, DC

posted over 3 years ago

Hey everyone. Does anyone have experience with rents from Section 8 / Housing Choice Voucher tenants. The payment standards for my area that are posted seem to be high.

People I know, say that a 3 bedroom house in our area goes for around $1500 a month. But the payment standard (below) says a 3 bedroom would be around $2,353. I know that Section 8 does a area rent reasonability study. However, I'm wondering what you all's experience has been with the difference between actual rent approved by Section 8 vs. their posted Payment Standards.
  Bedroom Size - Payment Standard (Taken from the PG County Housing site) Efficiency $1,504 1bedroom $1,561 2 bedroom $1,793 3 bedroom $2,353 4 bedroom $2,902 5 bedroom $3,337 6 bedroom $3,773 7 bedroom $4,208
Follow-up question: Can you ask for a potential tenants actual voucher to see what rents they have been approved for?
Rotate Log in or sign up to reply
user profile avatar
  • Posts 515
  • Votes 399

Brian Adzadi
from Allentown, Pennsylvania

replied over 3 years ago

@Tiana O.

I have not had many interactions with people on Section 8, but I have had colleagues who had rented out to Section 8 tenants. It seems HUD has its own standards on what they think is market rate rent for a neighborhood. Often than not they would pay higher than the average rent in the area. So whatever they say they will pay you for rent and it satisfies you, TAKE IT.

Follow up question: I am pretty sure you can ask the tenant or preferably the Section 8 program directors how much the tenant would have to cover.

Hope this helps.

Rotate Log in or sign up to reply
user profile avatar
  • Posts 260
  • Votes 161

Julie N.
Real Estate Investor from Unionville, Connecticut

replied over 3 years ago

My town has a housing office and they set their rates at market rates. That being said, I live in an upscale town- but my rental houses are average, smaller in size and without luxuries (granite etc). I can get higher rents if I rent to sect 8 since private pay tenants want more luxuries for the same rental amounts (they want more for their money).

Rotate Log in or sign up to reply
user profile avatar
  • Posts 9
  • Votes 2

Amanda Gant
from Washington, DC

replied over 3 years ago

They are real. Dm me. I've signed up and have two current tenants in the program. I'm making a ton of money now. I love in DC, too.

Rotate Log in or sign up to reply
user profile avatar
  • Posts 26
  • Votes 12

Aaron Cavazos
Investor from Washington DC, DC

replied over 3 years ago

In DC, the tenant will have a voucher in hand and a bedroom number assigned to them on the form. If you have a 4 bedroom house (70 sq/ft with ceilings a tenant 7'+, window, door, closet) then you can collect up to 4 bedroom rent but if the tenant is only approved for 3 bedrooms you will only receive 3 bedroom rents. You can go to the DCHA.org/rent website and look at your neighborhoods rent rates for the bedrooms assigned. Look at your tax bill for the actual neighborhood you are in and not the neighborhood you think you might be in (I have seen some weird things with this). You can also vary between including utilities or not. 

If it sounds like something you want to do then you have to submit a new owner lease up package to DCHA and have the home inspected before a tenant can move-in. I am doing this know for a client and we are on week 5 (mostly because DCHA is painful and because it was over the holidays). 

Rotate Log in or sign up to reply
user profile avatar
  • Posts 6
  • Votes 1

Devona W.
from Rockville, Maryland (MD)

replied about 3 years ago

@Tiana O, I have no experience with Section 8 tenants directly, however, I have colleagues who have. The HUD payment standards are real and verifiable, however, the difference in payment comes from the tenants actual income. Meaning, the tenant pays 30% of what their income is, and HUD will cover 70%. So, if the tenant has income, meaning a job, then 30% if their income will be delegated towards the rent. You as the owner are expected to collect the tenant portion. If they lose their job, and their income goes down to $0, if the tenant reports a change in circumstances immediately, HUD will cover the rent at 100%. In addition and depending on the written terms, this may or may not include utilities.

The rents paid by HUD are super desirable in a region like the DMV, however; I would caution you to take the necessary precautions that you would take with any other tenant, i.e. rental history, credit check, background check, and if applicable, employment verification.

Rotate Log in or sign up to reply
user profile avatar
Check Rosette Top Subjects:
Tenants, Rentals, and Finding & Screening Tenants
  • Posts 160
  • Votes 137

BOB CRANEY
from HIGHLAND, Maryland

replied about 3 years ago

I have 8 units with section 8 tenants and there are a lot of misconceptions on how the payments are figured out. The Payments standards you can find online are a maximum payment for a perfect house in a perfect neighborhood with the landlord paying all the utilities. A tenant gets a voucher that is good for a bedroom count only, its not for a set amount of money for rent. The voucher provides  flexibility to be used for a 2BR unit that the tenant finds that will meet their criteria. With the voucher in hand they can get a 2BR apartment, townhouse, condo or single family house. Your payment for each option may vary based on the area, size and amenities. You can ask the inspectors how the grading works and some will even show you the worksheets they use to analyze your property. The biggest variation i have seen is in how they grade the area on a good, better, best type system. i have had the same property graded differently by different inspectors and had to fight them because they tried to offer me less in rent than the previous section 8 tenant was paying. 

Your can post your listing on gosection8.com and  when its posted you can then access and option that will show you what they are paying in your surrounding area. Make a free fake ad just to check the rents then put it on inactive status until you are ready to rent it for real. Trying to get them to tell you what they will pay before hand is hopeless. If you know other landlords in the area, ask what they are getting and look at their places. I have had to politely argue with section 8 case workers sometimes and they can make mistakes in the calculations due to them not giving me credit for paying for water and sewer or the upgraded condition of my properties. Be aware though that the case workers often dont care if you accept their rent offer or not. I have only rejected 2 offers i was given but i asked for another rent comparable review and had the tenant complain loudly and ask for assistance in getting the rent bumped to a level i would accept so they can move. 

Check your market rates vs the rates section 8 will pay. These days in half decent areas, market rents are very close to what section 8 pays other than rougher areas, where section 8 will usually pay more. 

Rotate Log in or sign up to reply
user profile avatar
  • Posts 16
  • Votes 7

Jessica Jones

replied about 1 year ago

I have the exact same question! Nothing I'm finding gives a clear answer to this. I went to a local section 8 county landlord meeting and they weren't really able to answer this question either. Just sent a follow-up email to the county landlord liaison and will let you know what they say. 

Rotate Log in or sign up to reply
user profile avatar
Check Rosette Top Subjects:
Traditional Financing, Real Estate Finance, and Team
  • Posts 3.3K
  • Votes 2.7K

Kenneth Garrett
Investor from Palatine, IL

replied about 1 year ago

@Tiana O.

The market rates are generally on the high side.  Remember you have to back out utilities and they still analyze the market rent for the area.  The numbers are based on per zip code.   

Rotate Log in or sign up to reply
user profile avatar
Check Rosette Top Subjects:
Team and Flipping
  • Posts 2.2K
  • Votes 1.7K

Patti Robertson
Property Manager from Virginia Beach, VA

replied about 1 year ago

The SEC 8 rent approval calculation is complicated.  To save my fingers from typing every time this question is asked on BP, I put it in a blog.  Here’s is the link.  https://www.biggerpockets.com/...

Rotate Log in or sign up to reply
  • 1
Resources Read, see, and learn more!
Link Real Estate Investment Calculators
Link BiggerPockets Blog
Link Path to Purchase
Link Mortgage Loans
Link Find a Contractor
Link Real Estate Agents
Link Hard Money Lenders
Link Real Estate Listings
Log in Sign up

Log in

Forgot password?

If you signed up for BiggerPockets via Facebook, you can log in with just one click!

Log in with Facebook

Or
btn_google_dark_normal_ios Created with Sketch. Continue with Google

Let's get started

We just need a few details to get you set up and ready to go!

Use your real name

Use at least 8 characters. Using a phrase of random words (like: paper Dog team blue) is secure and easy to remember.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.

Or
btn_google_dark_normal_ios Created with Sketch. Continue with Google

Why create an account?

Receive a free digital download of The Ultimate Beginner's Guide to Real Estate Investing.

Connect with 1,000,000+ real estate investors!

Find local real estate meetups and events in your area.

Start analyzing real estate properties, we do the math for you.

It's free!

Explore

  • Membership
  • Community
  • Education
  • Marketplace
  • Tools
  • FilePlace
  • REI Resources
  • Perks
  • Glossary
  • Reviews
  • iOS App
  • Android App

Company

  • About Us
  • Press
  • Advertising
  • Careers
  • Stats
  • Contact Us

Important

  • Editorial Guidelines
  • Terms of Use
  • Rules
  • Privacy
  • FAQ

Social

  • Facebook
  • Twitter
  • YouTube
  • Instagram
© 2004-2021 BiggerPockets, LLC. All Rights Reserved.