Section 8
Hello fellow BP members-
I am hoping to get some words of wisdom from someone who has dealt with low income and/or rent controlled areas.
I am in escrow currently on a massive 4 unit apartment building near USC. There is a 5 bedroom house in the back and a triplex in the front (totaling 9 bedrooms). I saw the square footage on this one and thought it was an amazing deal ... before I crunched the numbers of current (not prorated) rent.
Since its rent controlled, the units are below market. What concerns me is the back house that's going for 1600/m and should be going for at least $2500. There is great cashflow using the prorated methodology, but using current rents the cash is modest at best.
Another tenant has told me she MAY be looking for another place. She's lived there for 10+ years and receives section 8.
How would you approach this? I was thinking of offering her a vacant unit in another building I own or simply paying her (don't really like that option). Has any of you encountered this problem before?!
Thanks so much in advance!!