DC Choice housing voucher

7 Replies

Hi BPers,

I'm looking into this DC choice housing voucher program. Has anyone tried this? Rents seem really high that they provide.

With any subsidized housing I worry about:

1. the quality of the tenant

2. the subsidy not being renewed, and me being stuck with someone that can't afford the rent

Looking for input on all of the above. Thanks!

Aaron

Hi Aaron-

I manage a few properties with HCVP tenants, and it can be a mixed bag, for sure. Yes, you can generally get rents above what you'd get on the market otherwise, and it's nice to have the safety of the government backing up your payments. There's also a very ready pool of potential tenants, especially once you build relationships with DCHA and case workers.


BUT, there are also some major pitfalls. Depending on how you're screening your tenants, you may have a hard time being able to find someone suitable if you care about credit scores and rental history. Many have previous evictions, lots of collection accounts, etc. My experience has generally been that our voucher tenants don't have much experience in how to take care of a home, and put in a serious amount of maintenance requests for things as simple as changing lightbulbs. Also, if you're not familiar with the amount of paperwork required to lease up tenants through voucher programs, it can be a bit daunting the first few times.

As for your second concern, this is also a very real thing to worry about. Less so with traditional vouchers, (as my experience has been that people receiving them can often get extensions as long as they follow the rules of the program) but definitely so with rapid rehousing vouchers. These only last for a year, and we've had several problems involving tenants who simply stop paying once it expires and force us to evict them. When you consider the time and expense in getting them out, suddenly that extra money you were making per month in rent evaporates very quickly. 

Bottom line, it all comes down to finding the right tenant. A quiet, respectful tenant who treats your property well makes the HCVP program extremely rewarding. But there are some nightmares out there, so use caution.

One of my major concerns with any scenario where the tenant is not paying the full rent themselves is payment for lease violations and damages.  Broke people don't have money by definition, and it doesn't take long for a nice house to get destroyed.  What if the city issues a citation for them not mowing the yard?  Here those run around $200 per mowing.  City contractors charge and arm and a leg.

You'll never collect a dime since the folks are too broke to pay rent.  How will they have any money to pay for damages?  

Not all subsidized rent tenants are bad, but if you get a bad one your options to recover damages are much more limited.  Key questions every land lord who accepts subsidized rents should be asking themselves:

1) How can you minimize the likelihood of getting a bad tenant?  

2) How will you collect if there are damages/fines?  

3) Is there anything about the subsidy that makes it harder to get rid of bad tenants for reasons other than non-payment of rent?

@Nick Pisano I talked to the lady at the HCVP office for about 10 minutes just now. She said that once the tenant qualifies, their rent is guaranteed even if they lose their job. Typically they pay 30% of the rent, but if they lose their job, the government pays 100%. According to her, once they get the benefit, they can't lose it unless they: 1. sublease the apartment or 2. engage in illegal activities.

Has this all been your experience as well?

One question I thought of after I hung up with her was, what if they stop paying the rent, but haven't lost their job.

I know people who have been very successful at this. It's not much different than getting a voucher anywhere. If you know how to screen and pick your tenants and you, or someone else knows how to manage them it works out great. 

@Aaron Smith what @Nick Pisano said.  DC is not like any other jurisdiction in the country.  It is all about finding the right tenant and an iron clad lease and the right tenant is not easy.  The job is the last thing you need to worry about.  If they are not used to living in DC run housing, every issue becomes a big issue and any profit can evaporate.  There is not enough training for tenants and the housing specialists are not social workers.  The cable bill will be paid before your water bill.  There is a freeze on rent increases.  If you submit for a rent increase it will be denied.  If you are in an area where you are stating that the rents are high, you can get a tenant for market rent and you can get that rent.  If the tenant is non subsidized you can increase rent every year.  Remember once the lease ends, the lease goes month to month.  You cannot evict because you want a new tenant.  Running a tenant to court everytime rent is late is not cheap and takes time.  I say all this to say that the program works with the combination of good tenant + solid lease + good management.  The people that run the program are great but can only do so much.  DC has a housing crisis and the unbalanced laws are not changing anytime soon.  Your only fallback is your lease.  For example, a tenant can give you 30 days notice if they are moving but you have to give 90 days notice.   Based on the area check out Zeus or Bungalow.  Get a property manager.   Tread lightly.  Good luck!

I am purchasing my first house in D.C. and will be renting out the main part of the house. Realize there are quite a few steps to make it a legal rental with the DCRA. 
I wasn't planning on going down the road of accepting vouchers, but how would I communicate this to potential tenants if they intend to use vouchers to rent my property, given that it is illegal to discriminate based on source of income or advertise that? Or do we just go through the motions of showing the property to everyone and accepting applications for all interested parties?

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