Section 8 Housing As Investment
Has anyone ever looked into buying Section 8 housing as an investment? I hear the government will pay for the tenants rent as long as I am renting it out.
However, this seems like it could be a serious headache just to aqquire some assets.
Any thoughts?[ Edited by Brandon2002 on Date 12/02/2003 ]
Hi,
I am also considering section 8 tenants. Has anyone charged them a fee for background checks like other non-sec 8 tenants?
I have actually heard that it is wise to charge a fee and that the Housing Authority helps screen tenants for you.
I just want to be sure it's not going to turn into a nightmare.
Section 8 has changed the rules recently. Most tenants are required to pay a deposit and section 8 will not be in the repair business any more. This is not that new but it was a major change. Check to see how much the tenant has to pay. You can charge a fee if this is your MO. You should not be different with sec 8 or any other class. It is a bit harder to manage a sec 8 property but the rent can be higher and it is paid as long as you conform to the sec 8 standards. Even in hard times where you will want to rent a 3br for a2br rent it is still good. Be sure to check all previous landlords and not just the current one. Visit their home. If it is filthy and they know you are coming, imagine how bad it will be normally. I did not follow my own advice and on several occasions it costs me mucho $$$$. You can not be so picky that you keep it vacant but you can learn from my mistakes.
Good LUCK and HAPPY HOLIDAYS
Hope this helps some
Ted Jr
Thanks, Ted. This helped a lot!
Someone I know who does sec-8 said that he tends to favor single moms with kids who aren't teens yet.
Now with a 3 bed room unti, I'll probably attract large families. Any advice?
Again, I will do my due diligence.
Also, I need to learn how to read a credit report. What do I look for? Do I go by the fico score?
Thanks again.
Thanks a ton for the advice.
Anyone who may have any questions regarding section 8 tenants/properties, contact the local housing authority for the area your rental is in. Cities tend to have their own, and then counties as well. They will tell you everything you need to know. Including how much in rent they will pay per home...
I am embarking on my first section 8 rental. I am in the Chicago area and my tennant has already paid me the security deposit. We are now waiting for the inspection to happen. I have spoke with many different people in different areas of real estate investing and they consider section 8 a whole industry for the repeat customer. The better your reputation as a good property manager and a clean building manager, the more responses you will get to your ads. It seems to me to be a recession proof type of business.
Good luck to you.
CK
I have been very happy with the section 8 program. Keep in mind that section 8 is not tied to a property (although it has to qualify and pass inspection). It is a contract between property owner and the Housing Authority part of which attaches to your lease agreement. My section 8 tenants pay their portion in a timely manner because they are afraid they may lose their subsidy and the government portion arrives very regularly.
Section 8 renting can be as good as you make it! We have section 8 tenants that are good, and we have some that are not so good! One of the nicest benefits is that most of the rent dollars (if not all) are guarantteed every month!
Another nice consideration is that the housing authority requires a yearly inspection of the premises to make sure that the tenant is caring for the property and that the property is still in good condition. The tenant may have areas that they need to fix (by a certain date), and the owner may have some items that need to be repaired! Either way, it is a good reason to get in your property every year to keep it up to par!
Best of Success!
BAMZ
Just wanted to throw my .02 into the mix. I currently own 2 properties. 1 is section 8 and 1 is not section 8.
In my limited experience the Section 8 renter has been 10xs better than the non section 8 renter.
Here in the S.FLA. area Section 8 has become increasingly protective and on the side of the landlords.
The Section 8 renters know that if they mess up their names will be removed from the rolls as a participant and will not be elligible for housing assistance in the future.
Hope this helps....
Just a little follow up, if the section in your neck of the woods is anything like mine, it may take some time to start receiving your checks if this is your first time with Section 8.
Once you are in their records and have at least 1 property it is fairly smooth sailing...
Do you think it would be beneficial to get a management company to handle all the Section 8 rentals I go after?
Does anybody else use a management company? What do they typically charge?
Thanks.
Quote:Any thoughts?Brandon2002,
Come to the Landord Forum. This question and related Section 8 questions have been addressed. Both positive and negative feedback on participating in the Section 8 program have been posted in the Landlord Forum.
You also have some misconceptions about the Section 8 program that might be dispelled by topics already posted in the Landlord Forum.