Section 8 housing is an essential program for many low-income families, and accepting Section 8 tenants can be a great use of your property. This article will discuss Section 8 and the factors that may help you decide whether you should accept Section 8 tenants.
One of the many decisions a landlord faces when establishing a rental property is determining whether the property will accept Section 8 tenants. The Housing Choice Voucher Program (historically and commonly referred to as Section 8 housing) provides assistance to very low-income families to afford decent, safe, and sanitary housing.
This is a great program from a low-income tenant’s perspective, but landlords are often unsure whether to accept a tenant with a Section 8 voucher. To help you decide, we’ve provided some information to help you with your decision-making process.
What is Section 8 Housing?
Section 8 Housing is a federally funded program, administered by your local housing authority, that helps low-income families and individuals find housing they otherwise could not afford. Those who meet the income qualifications are given a voucher through the Housing Choice Voucher Program that covers a percentage of their monthly rental payment.
Section 8 Housing is organized by state programs and their local housing authorities. For example, the Housing Authority of the City of Los Angeles receives funding from the U.S. Department of Housing and Urban Development (HUD), which is used to offer housing vouchers to people in the program.
Who Uses Section 8 Housing?
Renters who qualify must have low to extremely low income levels, typically determined by comparing an applicant’s income level to the local median income level. Renters in the program may be elderly, disabled, or merely those with little or no income.
What’s in it for a Section 8 Landlord?
On the renter side, Section 8 is a great option for those who need housing assistance. And for the landlord, there are other benefits to the program as well.
- Guaranteed On-Time Payments: Each month, you will receive a check from your local housing authority for their percentage of your Section 8 tenant’s rent. This can be anywhere from 30-100% of the total rental amount.
- Long Term Tenancy: Most renters who find a Section 8 accepting landlord will remain your tenant for a long time in order to avoid the process of the rental search again. For landlords, this means fewer vacancies and more money in the bank.
What are the negatives to being a Section 8 landlord?
One of the reasons that some landlords don’t like Section 8 is the bureaucracy involved in this government-regulated process. The regulation includes a safety inspection when the tenant moves in and ongoing inspections at least annually. After the inspection process, you’ll need to fix every item on their list before the tenant is approved for move-in. The inspection criteria are more stringent than most landlords expect, so the expense can be costly.
Since Section 8 is a government-subsidized housing program, landlords can expect the process to move slowly. Section 8 workers can be understaffed and overworked, which may result in a slow process of getting through the inspections, the contracts, tenants moving in, and waiting for your first check to arrive.
Are Section 8 tenants bad renters?
Unfortunately, Section 8 tenants have a bad reputation that stems from people believing that low-income/no-income equates to bad tenants. Landlords who have negative experiences with Section 8 renters claim that these tenants are more likely to cause (extensive) property damage, host long-term guests, and complain to management. On the other hand, there are plenty of landlords who have had positive experiences with Section 8 tenants, citing pleasant landlord-tenant relationships and reliable rental payments.
In reality, Section 8 tenants are no different than some renters who do not receive government assistance. There are bad renters out there who do not accept lease terms or respect the home they live in.
Ultimately, it doesn’t matter if a tenant uses Section 8 vouchers; there are bad renters out there not on the program who will make late payments, destroy the property, or lie to your face. It is up to the landlord to make a smart decision for the rental property based on thorough tenant screening. Treat every applicant, non-Section 8 and Section 8 renters, to the same process by running background checks to view criminal history, verify landlord references, and pull a credit report. If any red flags stand out during the screening process, you have a legitimate reason for denying the applicant and selecting a responsible tenant to live in your property.
How do I become a Section 8 Landlord?
In order to establish a Section 8 rental, the local housing authority must approve both the landlord and the property. Your local or state housing authority may have special requirements, but typically, any landlord or property manager can become involved in the program.
It is a pretty straightforward process that typically includes:
- An application: You provide personal information and details about the property and rental rate.
- An Inspection: Once approved, an inspector visits your rental property to make sure it meets the cleanliness, safety, and habitability requirements. For details about these requirements, check out this helpful guide on Section 8 Housing Criteria for Landlords.
That’s it! Once an inspector approves your property, you can start accepting Section 8 housing vouchers. From here, you can market your property and find your own Section 8 renters, conduct your normal application process, and complete a lease agreement with them. Upon moving in, the housing authority will mail you a portion of the rent once a month, and the tenant will pay you the rest.
Do I have to accept Section 8 tenants?
Depending on the state or city your rental property is located in, you may be subject to certain laws that protect Section 8 renters. For example, a law in California states that a rental applicant may not be rejected or discriminated against for their source of income, specifically the Section 8 program. This new specification falls under other Fair Housing Regulations and anti-discrimination protections that prohibit landlords from rejecting an applicant because of race, color, national origin, familial status, marital status, sex, sexual orientation, disability, or religion.
Chicago’s municipal code includes similar protections for Section 8 renters and prohibits housing discrimination based on the source of income, which includes applicants who have Section 8 vouchers.
While landlords in these areas cannot advertise their rentals as “No Section 8” or deny an applicant because of Section 8 involvement, they may still reject a renter with Section 8 vouchers for other reasons identified during the tenant screening process, like bad landlord references, a negative credit report evaluation, or a criminal record that puts the property, neighborhood, or other tenants at risk. For more information about legal tenant screening criteria, check out How to Create Written Screening Criteria.
Nolo recommends that landlords search online (start by checking the State Information section of the HUD website) and contact your local fair housing agency to see if the law protects prospects and tenants based on the fact that they have Section 8 vouchers. (If you own multiple properties in different states, counties, or towns, be sure to check the law for each location.) If you learn that state and local laws don’t ban this type of discrimination, then it’s up to you to decide whether to accept applicants with Section 8 vouchers.
Bottom Line: There are pros and cons for landlords who want to participate in Section 8 housing. You need to decide what is the best choice for your rental property and always screen every applicant with the same standards and criteria that avoid discrimination and protect your investment, Section 8 or not.
Lets not forget higher rates of drug use, i lived in an apartment that accepted section 8 housing assistance and those on it were absolutely terrible, they constantly had the police there. This was a nice apartment in a nice area, they brought the crap with them, one woman who was particularly terrible had her child taken away, and as she screamed about it the social worker, (a lady) walked up grabbed her arm and showed her the tract marks from heroin and said this is why your son is coming with us. She was evicted two weeks later
That sounds like it might have been a scary rental experience for you. Unfortunately, these types of situations can happen in all types of housing not just Section 8. I have heard great success stories of Section 8 renters and landlords who have had awesome experiences managing this type housing.
I rented to section 8 people twice and they trashed my place completely. This was my home and they destroyed it.
They called repair men into tighten the shower head ,ripped up 100’s of dollars of plants and landscaping and stole the bottom portion of washer/ dryer and broke the dryer dishwasher garbage disposal and backed up the plumbing onto the floor so often that it rotted the ceiling in the basement and created a hole in ceiling but didn’t call anyone about that. You could tell how old her children were by the height of the filth on the walls. I would recommend staying faraway from 8 and to top it off the govt didn’t pay they had a reason not to for whatever complaint they gave I couldn’t evict because it was winter. It was such a nightmare that I sold my home @ about a 35,000.00 dollar loss. Just so I could get out of the burden of fixing everything destroyed
Oh my gosh, what a nightmare! Thanks for sharing your experience Kat, it’s important that everyone know the realities of managing rental properties, good and bad!
We have been renting homes for 14 years. By far…. the worst experience I ever had was a section 8 family. In only 10 months they cost me $4,000.00, and Farmed roaches in the house. Absolute filth. It took the house cleaners three attempts to clean it, and it still was not clean. You will never convince me. Now I outright tell them I do not rent to section 8.
Oh, and by the way….. The “my husband lives with me but section 8 people are not supposed to know” Requires me to lie, and I just do not need the issues to be honest. Lexington Kentucky.
my mom had a sect 8 tenant…clean bath ,clean kitchen, fresh paint.
didn’t stay that way long.
both mother and daughter had wrist wrapped and do not work.
O. boy that’s disappointing because there r some good hard working people on section 8 who just can’t afford the high cost of living in today’s world for example a young single person or some one who is sincerely limited in their ability to work but still give back in there own way I wish those bad people get prosecuted and thrown off section 8 to make room for good people and not for nothing there’s some bad landlords out there but it’s still no excuse to damage some one else probably that’s crossing the line
I have rented properties for a long time over 15 years and I have had atleast 7 different HUD families who I have rented to. While some tenants had their bad sides and some had their good, Section 8 was a blessing as far as there being a check in the mail each month on time with no problems. Most my tenants who do not have HUD are usually late or just wont pay at all and then have to go through the whole legal battle.
Thank you for sharing your experience!