All Forum Posts by: Jamie O'Connell

Quote from @Patrick Goswitz:

Quote from @Jamie O'Connell:

Quote from @Patrick Goswitz:

Thanks for sharing this!!! I was going to do section 8 on a triplex I have that is completely remodeled. They are builder grade finishes but everything is new.

Unit #1- 4 bed 2 bath. SAFMR= $2410

Unit #2- 2 bed 1 bath. SAFMR= $1630

Unit #3 (Upstairs) 4 bed 1 bath. SAFMR= $2410

I have some questions:
From my understanding there is no guarantee I get the full SAFMR rate, is that correct? 

Are tenants going to be ok with a 4 bed 1 bath? 

Do your tenants pay the utilities?

Any other pointers would be great. This is my first section 8.

Great questions! So I get about $50 less than the fmr for 2025. But I do hear they are increasing it in October. One thing about section 8 is they tell you NOTHING. You have to guess and be a bit annoying in order to get the tiniest of detail. Yes 1 bathroom for a 4 bed will be ok. Normal market prob have some people not liking it but section 8 usually will be just happy to have an updated place with enough room. 

Do NOT pay their utilities. Take the cheaper rent (usually about $100 less) and have them cover as much of the utilities as your town will allow. Otherwise you’ll be paying $300-800 electric bills that cannot be explained. I made thst mistake and spent last year switching everyone over.  

 Thanks! I saw for 2026 in my zip code in 37917 Knoxville, Tn that they are reducing the SAFMR by a pretty hefty amount. I was super bummed to see that. Unless the numbers they released aren't really final. 

Decreasing? Wow, ours keeps going up a bit! I would definitely find someone in the area who has done a lease in last 6 months and find out what they did price wise. I will say on my end with section 8 I have to tell them my price and what’s included for the hap and if it’s too much they tell me what they will pay max. Also remember the portion they pay is based off the tenant. Some will pay $50 and some will pay like 40% of the lease. 

Quote from @Patrick Goswitz:

Thanks for sharing this!!! I was going to do section 8 on a triplex I have that is completely remodeled. They are builder grade finishes but everything is new.

Unit #1- 4 bed 2 bath. SAFMR= $2410

Unit #2- 2 bed 1 bath. SAFMR= $1630

Unit #3 (Upstairs) 4 bed 1 bath. SAFMR= $2410

I have some questions:
From my understanding there is no guarantee I get the full SAFMR rate, is that correct? 

Are tenants going to be ok with a 4 bed 1 bath? 

Do your tenants pay the utilities?

Any other pointers would be great. This is my first section 8.

Great questions! So I get about $50 less than the fmr for 2025. But I do hear they are increasing it in October. One thing about section 8 is they tell you NOTHING. You have to guess and be a bit annoying in order to get the tiniest of detail. Yes 1 bathroom for a 4 bed will be ok. Normal market prob have some people not liking it but section 8 usually will be just happy to have an updated place with enough room. 

Do NOT pay their utilities. Take the cheaper rent (usually about $100 less) and have them cover as much of the utilities as your town will allow. Otherwise you’ll be paying $300-800 electric bills that cannot be explained. I made thst mistake and spent last year switching everyone over.  

Quote from @Theresa Harris:

I'm curious-is $50 really 4% of her rent or is that a typo, and same with $93 and 6%?  The rents would have to be really high (eg $50 on a $2000 rent is 2.5%).  There are good and bad with everything, but for people who can't pay <$100 a month for part of their rent, you really have to wonder what they do.

My mathing might be wrong but for the 93 her full rent is 1400. She pays 93 and sec 8 pays 1307. For the $50 if it’s the first one her rent is $1200. She pays 50 and sec 8 pays 1150.

yes I always wonder where the money goes 

Quote from @Colleen F.:

@Jamie O'Connell  all I can say is I am glad it is you.   But this really illustrates why people are on and stay on section 8.  so many don't or won't pay a regular bill like rent no matter how small. they wait until something  forces the issue. 

 100%. It is structured so that once you get on it you stay on it and your children stay on it. It really is a very bad system that I think needs some serious revamping. All of my tenants who dont pay also have new cars, latest I phone, PS 5 etc. 

Thank you! I hate seeing the TikTok section 8 people only talk about how great everything is. Try and keep everyone updated on the different outcomes! 

I try and give updates on the good and bad of Section 8 tenants as I have 9 tenants on Section 8 now.

I will start by saying for the most part I have 5 of those tenants who are no problem, they always pay their portion and are not a problem. The other 4 are varying degrees of what the world expects of a Section 8 tenant. 

I have 6 tenants who are not on Section 8 and are not included below as they are just normal lease and so far so good but if your in real estate you take a risk no matter what. 

Yes I do know that I lose $1000-$2000 a year by being lax on the small portions not being paid but considering the guaranteed portions are so large It is a situation I am ok with. It's not for everyone but I can work with it.  

Tenant 1 - Her portion is $50 a month. She has not paid her portion in over a year. I let it go as she is never a problem and that $50 only accounts for 4% of her rent. I will say that whenever we do push for something she does get mildly problematic and noisy until we go away. As she keeps to herself and keeps the unit in good shape and isn't a problem, I let it be. This is the best type of "problem" section 8 tenant you can have. 

Tenant 2 - Her portion is $600 (honestly highest ive ever seen on the program and I didnt think it could account for so much of the rent but here we are). She stopped paying her portion 2 months ago, as her portion makes up about 60% of her rent (again still surprised they went this high) thats definitely a problem for me. She is also very unclean, moved a dog in against the lease AND brought in 3 people who are not on lease who are straight up trash. So she is currently in for eviction. I hope to have her out in the next month. She also has a warrant out for her arrest so thats a fun side piece. Otherwise she is actually a nice person, I just think she is a product of her upbringing and unwell. 

Tenant 3 - Her portion is $93. She has not paid her portion in 4 months and likes to go radio silent when pushed. Again, this is VERY normal with section 8 tenants. Her portion only accounts for 6% of her rent so it's not a huge deal but I did end up going to Section 8 and complaining because well, I hate being ignored. She is now communicating towards paying her portion. All in all, annoying but really not huge for me. She keeps it clean, is never an issue and her portion is small. 

Tenant 4 - His portion is $300 which is 31% of his rent. He ALWAYS pays within the first week. He is older, single, super clean, mows the lawn and takes care of the property. I would do anything for this man honestly. He is on my list to give a good discount to at the end of the year for being amazing. I did this last year and he was super thankful and honestly he deserved the break. 

Tenant 5 - She has been my tenant for 2.5 years (since I started) and all in all she is good! Goes through about 8 phones a year which is odd but a normal Section 8 situation. Her portion has been about 200 for the last year and usually pays on time. Have to hunt her down a good bit but she always pays her debt so I respect it. Now she pays $0 so im even happier. She speaks her mind but is a good tenant and im happy to have her. 

Tenant 6 - Lord have mercy. This one is a handful but as long as I dont reach out to her about her responsibilities she is quiet as can be. She moved in 2 years ago and hasn't paid her portion in 1.5 years. Her portion is $50 a month and accounts for 3% of the total rent so I never cared in insane amount. Every once in a while I would get a bug on principal so I would turn it into the Section 8 people and they would write a letter. Her rent portion went up this month (got a job) and her new rent is 30% of the rent. So I did what any landlord would do, I wrote enough to Section 8 and she ignored their process enough that they kicked her off the program. I would feel bad but she has the newest toys in her apartment so she could have paid the $50 a month if she wanted and I would have been all good. She had ten days to pay her debts before they kicked her off the program for good. Wouldn't you know it, I got allllllllll the back pay within 8 days. I am now happy as can be and section 8 is now allowing her to stay on. I might get some flak on this one but I stand by my decision. I believe I will have to play the eviction game every month to get her to pay her portion but I think she just played the game for as long as allowed. Otherwise she is a nice clean tenant. 

Tenant 7 & 8 - Never a problem and pays $0 so we go about our life. 

Tenant 9 - She pays about 38% of her rent and she moved in 5 months ago and has never been late with her portion, never has to be hunted down for it and has never been a problem. She is another one who I think I will give a discount at the end of the year. 

I would not do Section 8 anyplace you dont live OR have a good team. I do it out of state but I have a prop manager who handles everything and a competent construction crew to handle everything. I have some sec 8 tenants who pay $400 a month for their portion (state pays the rest) and they have never been late. I have 3 tenants who pay $50 a month and ALWAYS have an excuse why they dont pay. I wait 10 months and start the eviction process to get them to catch up. They are also the trashiest of the spectrum. It's a good payday but as I said, if you aren't a few houses in I wouldn't recommend it. If you dont live there or have a team set up I HIGHLY suggest not going that route. 

Quote from @Jordan Frisco:

Quote from @Jamie O'Connell:

Quote from @Jordan Frisco:

Quote from @Jamie O'Connell:

I personally due the section 8 route. it is not stress free though, section 8 is rough. ! If you can do most of the work yourself, I would try and do a mix of buying, fixing and holding and buying and flipping. Get the monthly cash flow growing while also a mix of the bigger cash outs. 

I think this is one of the better routes for sure. Easy to off load as needed and can remove a lot of headaches after initial inspection and approval from the housing authority. 

 Yea definitely. I am not handy myself so I cant (aka dont wanna) do alot of the labor myself. So between that expensive fact and the fact that it's hard to find houses under 200k in my area I dont do it. I firmly believe in my area that after repair value values 300k and under sell MUCH faster than anything above. 

But if I could find something good I would definitely hop on it because the big cash influx would be nice to help continue buying more income producing properties.

Real estate is a journey, everyone goes their own route and long as you are looking at all the possible outcomes you will definitely do well. 

I think it is one of the things that people say is passive but they are lying to you because it takes you to be actively engaged mentally to make the right moves, book the right deal, keep a tight schedule and keep the ball moving forward to set yourself up for success. Do you mainly focus on 200-300k houses and do mix off fix and hold and fix and flip?

No the area I buy is much cheaper (cause it's a crap town) so I do fix and holds. If I could find good fixer uppers where I live in PA though, buying in mid to top 100's and selling for top 200s would prob be my sweet spot. 

Quote from @Jordan Frisco:

Quote from @Jamie O'Connell:

I personally due the section 8 route. it is not stress free though, section 8 is rough. ! If you can do most of the work yourself, I would try and do a mix of buying, fixing and holding and buying and flipping. Get the monthly cash flow growing while also a mix of the bigger cash outs. 

I think this is one of the better routes for sure. Easy to off load as needed and can remove a lot of headaches after initial inspection and approval from the housing authority. 

 Yea definitely. I am not handy myself so I cant (aka dont wanna) do alot of the labor myself. So between that expensive fact and the fact that it's hard to find houses under 200k in my area I dont do it. I firmly believe in my area that after repair value values 300k and under sell MUCH faster than anything above. 

But if I could find something good I would definitely hop on it because the big cash influx would be nice to help continue buying more income producing properties.

Real estate is a journey, everyone goes their own route and long as you are looking at all the possible outcomes you will definitely do well. 

I personally due the section 8 route. it is not stress free though, section 8 is rough. ! If you can do most of the work yourself, I would try and do a mix of buying, fixing and holding and buying and flipping. Get the monthly cash flow growing while also a mix of the bigger cash outs.