Del Val Blog

Property Management Blog

Section 8: Don't Hate

Section 8: Don't Hate

Interested in dipping your toe in the section 8 pool? Understanding the process is the first step.

Section 8, what is that? Sometimes it gets a bad rap, but it’ s a federal program that allows private landlords to rent properties at a fair market rate to qualified, low-income tenants. It is funded by the U.S. Department of Housing and Urban Development and is administered by local housing authorities in the city or county.

There are several requirements for landlords who want to accept section 8 (aka “the voucher program”) tenants.

  • Agree to accept the negotiated rent from the designated housing authority
  • Have a valid rental license and/ or a Use and Occupancy certificate
  • Have completed initial inspection before section 8 will agree to subsidize the property. Yearly inspections are subsequently required, usually safety based
  • Show proof of ownership
  • Show proof that taxes are paid
  • Encouraged but not required to take a landlord class

 In turn, there are requirements for the tenants as well.

  • Tenants must have a valid voucher. This is an agreement between the prospective tenant and the housing authority. There are term limits for the voucher holder to find a suitable property that meets the criteria of the voucher.
  • Meet the requirements of the housing authority. These are usually family size and income. A tenant is usually working a full or part time job but is unable to sustain themselves and the family
  • An approved application from the landlord or management company. Background and credit checks are up to the individual landlord’s discretion.
  • All tenant forms completed and signed by the appropriate parties within the time period set by the housing authority

Disadvantages with Section 8.

  • Tenants might be unreliable and not respectful of the property. There may be housekeeping issues and a failure to keep up with yard work or snow removal. This might require a more constant eye on the property by the landlord or management company.
  • Many times, there are more repair requests for section 8 tenants.
  • If the tenant does have to pay a partial rent, they might neglect their responsibility.

Advantages with Section 8.

  • One large advantage to renting to a section 8: consistency. Because the rent is paid through the local municipality or county, it is guaranteed. It comes on time every month, same day, same amount. This can help with budgeting of repairs or annual expenses, two crucial items in terms of turning a profit.
  • The monthly rent price is often slightly higher than the average rents in the area. This incentivizes landlords who would normally shy away from the program to consider renting to the voucher holder.
  • Section 8 markets and advertises the units directly to their tenants.
  • Landlords can request a yearly increase in rent.
  • Section 8 tenants can be evicted. Landlords would go through the same process as if they had a self-paying tenant. Evictions are less common with section 8 tenants as this would threaten their ability to receive assistance through the program.

Because of the current real estate market both counties and Philadelphia are offering sign up bonuses for landlords who will take a section 8 voucher. Bonuses have been between $500-$1500.

If you think that renting to a section 8 tenant may be for you, please let us know. All our property managers are well versed in the procedures and paperwork that comes along with the voucher program.