All Forum Posts by: Alyssa Dyer

@Antonio R Moss OKC is an attractive market for cash flow, stability and approachable price point. You can typically lock down a property that's performing as-is at an 8% cap rate for 60-80k. It's worth adding to a list of places to consider. 

@Daniel Rasmussen I know a lot of investors selling two off at a time. These are all in the 60-80k range. They offer them individually normally but consider providing a discount to add on a second. I think five is a great number that's big enough for a bigger player, but small enough to be approachable at that price point. 

@Meredith Burt great to hear! Perfecting the process. 

@Vincent B. oh understand. Yeah legally it wouldn't be an option. 25% down is going to be your move. A lot of investors I know use the same lender and he's licensed in every state. Easy to work with and competitive rates. Let me know if you want contact info!

I can only speak for Oklahoma, but here are my 2 cents on section 8! I'd love to hear how this compares to others' experiences in other states.

What I like:

1. The government pays a portion or all of the rent. That’s a guaranteed payment every month.

2. If a section 8 tenant doesn’t pay they are at risk for losing their assistance.

3. I can’t speak for other states but Oklahoma is VERY landlord-friendly, even with section 8. If tenants don’t pay you are able to evict in ~45 days for under $500.

4. For 4 and 5 bedroom homes, the government is willing to pay higher than market rent rates for section 8 tenants. That said a tenant often pays a portion of their rent, so you must update cosmetics etc to incentivize someone paying higher rent. You also have to prove to section 8 that the property is worthy of a higher rate.

5. We see section 8 tenants have longer stays at properties. It’s not across the board, but it is common.

What you should be aware of:

1. Your first 3 months of rent payment will be delayed after you take over ownership. This is providing time for the agency to process the change in ownership in their end. You will be paid all back pay.

2. Your property manager should handle all correspondence/paperwork/leasing with section 8. No extra burden should come to you personally.

3. Once a property is qualified for section 8 it does not mean that you can ONLY lease to section 8 tenants. At turnover, you can market to section 8, non-section 8 in conjunction. Or if you no longer want to market to section 8 tenants, that’s fine!

4. Once a year section 8 requires an inspection and repair of anything they deem deficient. Your PM should schedule this and also schedule any repairs and ensure that you stay within the guidelines. The repair requests are sometimes a bit nitpicky, but if a section 8 tenant has been in place for some time we are very rarely surprised by what comes up on these requests. The requests are a bit more expensive if it’s the first time you’re getting approved by section 8.

How you should best position yourself:

Because section 8 tenants often have families there can sometimes be more wear and tear on your house. We suggest keeping costs low by replacing any damaged items with durable items. So LVP instead of carpet, dome lights instead of ceiling fans etc.

Happy to answer any questions about my experience! 

@Leigh Harris just looked through the comments.. I'm essentially repeating exactly what @Ramon Flores said. Good advise Ramon! 

@Leigh Harris most of the investors I know buy sight unseen. A set of recent photos lets you know it's not destroyed, but you want to get a licensed inspector in after you get contract regardless of how something looks (via photos or a walkthrough) so just let the inspectors make the call! Are they still allowing inspections in the area? 

Perfection. Where are your properties? 

I don't think it's too late to sell at least in OKC. I've seen sellers send out their deals at what they planned on selling them at pre-covid. They're being a bit more giving during the repair process, but especially with section 8 tenants, returns are staying the same for buyers. 

 We're on the same page. SO much comfort in section 8 right now! Providers that typically sell properties with tenants in place and that can show recent rental history provide some security as well especially if the pay in May and June.