Renting to Section 8 Tenants - What to Expect
By Dale Classic
When I bought my rental buildings I was not planning to rent to Section 8 tenants, I didn’t even know what Section 8 was! One day a pleasant young mother called to inquire as to whether I would accept Section 8. I took an instant liking to her, and made a call to the city to found out how this program works. Basically, the city pays the rent, and the federal government reimburses the city. There is a lot of extra paperwork, but once you understand the process, it goes rather smoothly.
The vast majority of Section 8 voucher holders are single mothers with children, but a few are grandmothers with grandchildren. Vouchers are normally in force until the children are grown, but the government’s portion of the rent fluctuates according to the tenant’s income.
You are actually better off to have a tenant with a low income, since in that case the government will pay the majority of the rent.
Before applying for the program, call your local Section 8 office and find out what the allowed rents are in your city for 1, 2 and 3 bedroom homes. Rents are determined according to the average in your area. If the amount is acceptable to you, call your building inspector to find out if all of your “bedrooms” qualify as such. You will find that lofts, dens without closets and some basement rooms do not qualify as bedrooms.
The next step is to schedule an inspection. Before the inspector comes, patch any holes or tears in screens, make sure bi-fold and sliding doors operate smoothly, and check that all electric outlets are grounded. I use a little plug with three colored lights built-in that indicate whether the outlets are properly grounded. Make sure that you have ground-fault-interrupter outlets near sinks in the kitchen and bathroom, as they will definitely be looking for that. GFI outlets have the little red reset button. Also make sure that bathtubs and sinks drain quickly. Make sure that all light fixtures have working light bulbs. Check for loose stair treads and handrails. Basically, the inspector is looking for functionality and safety. He will not care whether or not you have a dishwasher, but if there is a dishwasher, it should be in working order. Similarly, he will not care whether you have painted or installed new carpet, but loose carpet will not pass, and neither will holes in the walls!
When you have passed inspection, you may find that your local city housing authority has a Section 8 family interested in your unit. Make sure that your unit is on their list of available homes, as this is not necessarily automatic.
To attract a tenant, just put the line “Section 8 Ok” at the end of your regular advertisement. This will actually discourage tenants that do not have Section 8 vouchers, so you will need to run a separate ad to attract them. Make sure all your ads list the same price. You are not allowed to charge Section 8 tenants extra, even though the whole process is more work for you.
When you start to receive calls on your ad, you will find that many of the callers are under the mistaken impression that they can move on the first of the next month, when in fact their lease calls for 60 days notice, and the 60 days does not begin until the 1st of the month following the notice. They also sometimes tell their landlord that they are “thinking about moving,” and then mistakenly think that this was sufficient notice. I only mention this because in my experience most of the Section 8 prospects who call me have not given sufficient notice to their current landlord, and they cannot afford to pay rent on two separate apartments. I always talk to the current landlord to find out the situation. You will find that these applicants appreciate the extra help.
It is very important to