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Yoel Peyamipour
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Section 8 investing

Yoel Peyamipour
Posted May 24 2023, 14:51

Hi, Im 19 years old and new to investing. After listening to the BP episode with Dr Joe, I got into section 8. im not sure though where to really start especially since my are I live in is very expensive (NY). Anyone have any zip codes that may be a good place to start looking for section 8 properties to invest into?

thanks so much!

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Jonathan Taylor Smith
  • Rental Property Investor
  • Durham / Raleigh (Triangle), NC
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Jonathan Taylor Smith
  • Rental Property Investor
  • Durham / Raleigh (Triangle), NC
Replied May 24 2023, 17:25

First, what do you mean exactly by "section 8 properties"? I invest in rental properties and I choose to rent some of them to persons with section 8 vouchers when and where it pays near, at or above what a non-subsidized tenant would pay in rent for the same property. But there is nothing special about the property that makes it "section 8" prior to obtaining it and placing a voucher holding tenant.

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Yoel Peyamipour
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Yoel Peyamipour
Replied May 24 2023, 19:42

@Jonathan Taylor Smith thats what I mean- rental properties that you can rent out to voucher holders. D you have any zip codes that may be a good place to start looking for section 8 properties to invest into? I was looking at Ohio and Connecticut, specifically Cleveland,columbos,cincinatti and Hartford, ct

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Richard F.#1 Tenant Screening Contributor
  • Property Manager
  • Honolulu, HI
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Richard F.#1 Tenant Screening Contributor
  • Property Manager
  • Honolulu, HI
Replied May 24 2023, 20:08
Aloha,

All Section 8 units will need to pass a fairly thorough inspection by the local Housing Office, and you will need to agree to attach the HAP contract and addendum to your Rental Agreement, so you should be familiar with the inspection requirements and terms of these documents.

Here is a link to a variety of forms/documents you will need utilize, in addition to the HAP Contract, Tenancy Addendum, Inspection Checklist, and Inspection Form:

https://www.hud.gov/program_of...

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Jonathan Taylor Smith
  • Rental Property Investor
  • Durham / Raleigh (Triangle), NC
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Jonathan Taylor Smith
  • Rental Property Investor
  • Durham / Raleigh (Triangle), NC
Replied May 24 2023, 20:25

@Yoel Peyamipour  - OK, just wanted to make sure we're talking about the same thing... You'll want to go to: https://www.huduser.gov/portal... and see what HUD/Section 8 will pay for X bedroom rental units in the county you're targeting to acquire properties. Then determine if you can obtain properties in those locations for a price that will make them cash-flow positive at the indicated Section 8 rental rates. Then investigate the housing authority in that location to learn if they are a well-run organization - or a train wreck. How many employees do they have? How many inspectors? How long does it take for them to approve a request for tenancy approval? How long after tenant placement do they begin paying rent? Can you get someone on the phone? And if not, how long (or how many days) does it take to get an email response?

A poorly ran local housing authority can single-handedly make Section 8 not worth the effort. About half my rentals are Section 8, and while not perfect, I find the housing authority in my location to be decent and I'm glad to be part of their program. But I would advise you to find rentals that would work with Section 8 and/or non-subsidized tenants alike.

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Michael Doherty
  • Real Estate Agent
  • West Hartford, Ct
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Michael Doherty
  • Real Estate Agent
  • West Hartford, Ct
Replied May 30 2023, 16:50

@Yoel Peyamipour Hartford, CT has a strong rental market and many tenants utilize housing vouchers of various programs. For example, I am selling a 6 unit (3br 1b) each unit and all the rents are $2,000 a month (3 of 6 are section 8) and tenants pay their own utilities. There is still good cash flowing assets out there you just have to know where to look. For CT I would consider: Hartford, Bristol, New Britain, Manchester, Meriden, Middletown. 

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Yoel Peyamipour
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Yoel Peyamipour
Replied Jun 12 2023, 13:18

@Michael Doherty

thanks for the advice, ill check it out