Advantages of Renting to Section 8 Tenants
Pros of Section 8 Tenants in Your Rental
Some landlords have concerns about renting to Section 8 tenants. They worry that these tenants will destroy their property and keep other, quality tenants from wanting to rent from them. In addition, many landlords have heard horror stories about constant Section 8 inspections. While there can be negatives when dealing with Section 8, which is also referred to as the Housing Choice Voucher Program, there are many advantages as well.
Here are four reasons to consider renting to this tenant pool.
4 Main Advantages of Section 8 Tenants:
- Consistent Rent Payment by the Government
- Targeted Marketing
- Consistent Tenant Base
- Pre-Screened Tenants
1. Consistent Rent Payment by the Government
Section 8 is a government program that provides rental assistance. Tenants apply for the program, and if they meet certain requirements, they are granted a housing voucher from the government. This voucher allow the tenant to look for housing within a certain price range.
Once the rental unit has been approved and inspected by the local Public Housing Authority, you can sign a lease with the tenant. The Public Housing Authority is responsible for paying the tenant’s housing voucher directly to the landlord each month.
Renting to a Section 8 tenant, therefore, provides the advantage of receiving the rental payment consistently each month. The Public Housing Authority will either mail you a check or they will deposit the amount directly into your account.
Sometimes a tenant is still responsible for a small percentage of the rent and must pay this portion directly to you. Section 8 tenants know that any violation of the terms of the lease agreement, including paying rent, could result in the loss of their Section 8 voucher. Therefore, they have a strong incentive to pay their portion of the rent each month.
2. Targeted Marketing
If you decide to make your property Section 8 friendly, a second advantage to consider is the unique marketing opportunities available to you. There are marketing opportunities both online and in person.
- Online: If you choose to advertise your rental online, not only can you advertise the property on traditional sites such as Trulia and Craigslist, but Section 8 has a website that is dedicated specifically to Section 8 tenants. It is called Socialserve.com. You must first register online or by phone. Once registered, you are free to post any Section 8 friendly listings you have on the site. This is a great resource as it allows you to specifically target the Section 8 market.
You should also check with your local Public Housing Authority. Many local offices have their own online sites where you can also list your rental.
- In Person: When marketing to Section 8 tenants, you not only have the traditional marketing options available to you, such as grocery stores and community bulletin boards, but you can also post flyers in your local Public Housing Authority office. There is also a master list of available Section 8 units that you can add your property to. This list can be viewed online or directly at the office as a hard-copy. This marketing method is a great way to reach those that may not have internet access and to zero in even more on your local Section 8 market. It does not cost anything.
3. Consistent Tenant Base
A third advantage of allowing Section 8 tenants in your property is that you are opening up to a previously untapped tenant base. Not only are your broadening your tenant base, but you are also opening your property to a consistent tenant base.
There is high demand for Section 8 vouchers across the country. Many areas have wait lists thousands of people long to be on the program. Therefore, you do not have to worry that there will be a shortage of Section 8 tenants. Even if your market does not have a large number of tenants on Section 8, by accepting these tenants, you are not relying on them as the only way to fill your vacancy, but rather are just increasing your prospective tenant pool.
4. Pre-Screened Tenants
The final advantage of renting to Section 8 tenants is that they have been pre-screened.
In order to qualify for Section 8 housing, tenants must meet certain requirements. The Section 8 office focuses their screening on the tenant’s income level. However, they often uncover other issues while conducting this income screening, such as a criminal history. Public Housing Authorities will not provide Housing Choice Vouchers to those who have been evicted due to drug related activities within the last three years.
The Public Housing Authority is required to provide the landlord with the following information:
- The type of screening they have conducted on the tenant.
- The tenant's current and previous addresses.
- The name and addresses of the tenant's current and previous landlords.
Section 8 does conduct this basic screening for you, but you should you rely solely on their screening. You should conduct thorough tenant screenings on all of your tenants, including Section 8 tenants. This should involve a credit check and background check. Taking the time to properly screen tenants can help you prevent costly evictions and property damage.