LA County to forbid discrimination on Section 8 status

5 Replies

https://www.nbclosangeles.com/news/local/LA-County...

Something that LA County landlords should keep in mind, as I see many listings on Zillow, in south LA especially, which explicitly state "no Section 8." Might make sense to talk to a housing attorney about strategies here, but I know in places like NYC, landlords created and stuck by clear income and credit score guidelines, which in most cases tenants on vouchers will not meet. For the record, I think Section 8 can work for some folks, but I don't like the idea of forcing it on landlords, especially given the fact that payments to landlords might be missed due to government shutdown etc.  

We have those laws as well.  In reality, if you have a screening process, you are not forced to accept those tenants.  For example, you require a 700 credit score minimum and apply that to all applicants.  Someone correct me if I am wrong about this in your market.

If you own properties in areas that vouchers are common - parts of South Central Los Angeles, it probably is beneficial to take the vouchers.  It is a pain to go through the paperwork, but once you understand it, it is easy. 

Many local housing authorities who administrate the section 8 program, want to expand the geographical areas for the voucher holders.  We get extra money if we rent in areas designated as opportunity zones.  Still, the voucher amount will rarely be enough for tony areas such as Beverly Hills.

Originally posted by @Brian Ploszay :

We have those laws as well.  In reality, if you have a screening process, you are not forced to accept those tenants.  For example, you require a 700 credit score minimum and apply that to all applicants.  Someone correct me if I am wrong about this in your market.

If you own properties in areas that vouchers are common - parts of South Central Los Angeles, it probably is beneficial to take the vouchers.  It is a pain to go through the paperwork, but once you understand it, it is easy. 

Many local housing authorities who administrate the section 8 program, want to expand the geographical areas for the voucher holders.  We get extra money if we rent in areas designated as opportunity zones.  Still, the voucher amount will rarely be enough for tony areas such as Beverly Hills.

 You're correct re the requirements. I used to live in NYC and they did the same thing, required monthly income of 3.5x the rent, and a 700 FICO in most of Manhattan, and now a lot of Brooklyn and Queens is the same. In LA, I think even if you put a requirement of 650, most voucher holders would fall short.

Believe it or not, as south LA and areas like Compton and Watts have improved, you see more and more landlords not accepting Section 8 and still getting good rents with market tenants who have well over 600 FICO and decent income - I would say over half of the rental listings I see in those areas won't accept it at this point. There's just so much demand here, I think voucher holders have been pushed more to outlying counties (San Bernardino especially, Riverside too) over the past 15 years or so. 

We have most of our properties in South LA. About 20% of our tenants our Section 8. It depends on each landlord's threshold / willingness to deal with Sec 8's BS as well as the drama of people in this socio-economic status, but it's been good to us for the most part.

Now, regarding discrimination...if you have any screening process, it is ridiculously easy to screen out most tenants. It might not be according to the exact "letter of the law" but you need to protect your assets, as the govt is doing virtually everything in its power to screw you. And thankfully you have many tools in your toolset to disqualify applicants.

I do a very thorough background check, and scrutinize the application itself. Note that ANY discrepancy or missing field on the rental application can be used as a disqualifier.
 

I am also calling the tenant's most recent landlord, and (probably more importantly) the landlord before that. 

As a rule of thumb, in Los Angeles County you're either going to be happy to get Section 8 rents  or charging so much more that they aren't even going to call you.

Not something I would worry about.

@James Yoo good point "ANY discrepancy or missing field on the rental application can be used as a disqualifier." I should mark that!  Thank you for your valuable input!