Summary: In this article you’ll learn more about Section 8 and why now is a great time to invest in project-based Section 8 housing and/or rent to tenants with Section 8 vouchers. You’ll also learn about six real estate markets where there are single family and multifamily Section 8 properties for sale with experienced management in place.
Whether it’s project-based or tenant-based, a lot of investors shy away from Section 8. And it’s not hard to understand why. There are a lot of risks associated with it, including rental pricing regulations, greater difficulty evicting problem tenants, somewhat higher likelihood for property damage, difficulty selling properties to the free market and more.
BUT there are also a lot of benefits to choosing Section 8 – especially if you work with a property management company that has experience renting to Section 8 tenants. This is even more true right now due to Coronavirus. With all the people losing jobs many people are becoming unable to pay rent, but this isn’t a problem for Section 8 landlords.
Did you know that if a Section 8 tenant loses their job or part of their income, the government will pay the difference… up to 100% of the rent? This means that Section 8 property owners can still expect to receive consistent monthly income even in times of great uncertainty like today.
Another great advantage of being a Section 8 property owner right now is that there could very well be an influx of renters who need government subsidized housing in the coming months. This means vacancy rates may decline significantly for Section 8 landlords.
Continue reading to learn how you can start accepting Section 8 Vouchers at properties you currently own and to find out about six real estate markets where you can buy Section 8 properties with experienced management in place.
How To Start Accepting Section 8 Vouchers At Your Current Property
In order to start accepting housing vouchers at your current properties, your local housing authority must approve both you, the landlord, and your property. Here’s an outline of how to qualify as a landlord in the Housing Choice Voucher Program.
- Contact your local public housing authority. The housing authority contact information can be found on your state’s Public Housing Authority website. Each housing authority has different preferences and requirements based on their service area affordable housing needs.
- The housing authority inspector will meet with you and inspect your property to make sure it meets all local building and safety codes. They will use a government inspection form. They will also review your rental rates to ensure that they fall in line with rates for comparable dwellings in your area.
- Once the inspector approves your property, you will sign a W-9 and paperwork to then begin accepting Section 8 housing vouchers. At that point, you find your own tenants or they find you.
- Then, once a month, the housing authority will mail you a portion of the rent or directly deposit it into your bank. The tenant will pay you the rest. Although your rental rate may stay the same, the amount paid to you by the government may fluctuate depending on the Section 8 tenant income.
6 Markets with Section 8 Properties for Sale
At RealWealth® we connect investors with property teams around the country that have experienced property management in place. Six of these teams manage project-based Section 8 properties and/or accept tenants through the Housing Choice Voucher program.
These markets include:
- Baltimore, Maryland
- Birmingham, Alabama
- Chicago, Illinois
- Cleveland, Ohio
- Detroit, Michigan
- Jacksonville, Florida
Most of these markets have single family homes for sale and some also have small multi-family units (typically 2-4 units) available as well.
If you’d like to view Sample Property Pro Formas, connect with the teams we work with in any of these markets, or speak with one of our Investment Counselors, become a member of RealWealth for free. Click here to get started.
Also, when you connect with one of the teams we work with and/or with one of our Investment Counselors, make sure to ask about investments that meet our REAL Income Property™ Standards.
You can also learn more about what’s happening in these markets due to COVID-19 on Red Stag Fulfillment’s State-By-State Guide.