Cool Guy,

Concerning the saleability of your Section 8 complex, I think it may be important to know your buyer (easier said than done, eh?). It is my understanding that traditionally Section 8 housing has been considered "low rent" & "downscale", although that no longer seems to be the case. The upsides seem to be guaranteed payment (up to $1080.00). I hope this helps.

[url=http://www.centrepointetownhomes.com]Centre Pointe[/url]
Murfreesboro, TN.

Does Section 8 vary from state to state?

Here in Ohio it is nice to have a Section 8 rental because your rent is always there on time. But, they tend to be "hard" on the property itself and most investors claim the repairs are higher and Section 8 requirements are tougher on the property itself. So, you find yourself putting more money into the home for it to continue to be up to Section 8 code.

A nice perk for renting to section 8 tenants is the steady reliable portion of income from the city/county. Careful screening will insure steady reliable income from the tenant too.
Some hardship cases receive 100% assitance.


Regarding the rent..here in VA the final rent is decided when the inspection takes place near the end of the process. The split between the city/county and the tenant is also revealed. Many times the allowed total rent is less than the landlord wants to rent for. Simple research can reveal a likely rent. Some landlords just roll with it, others have the tenant pay on the side. This is not allowed from my understanding and is against regulations. The section 8 office may allow a 900/mo rent of wich they will pay 600/month. Leaving the tenant with a 300/mo obligation. Sneaky landlords say they want more. Tenants are eager to oblige since landing a lease is tough to do if you are on the voucher system.

Here is a link that will take you to the page where you can find out the fair market rent for Section 8 in your area.

http://www.huduser.org/datasets/fmr/fmrs/fy2009_code/index.asp?data=fmr09

I am not sure if these #'s are including utilities or not.

Here is the original link I used to get there.
http://www.hud.gov/groups/landlords.cfm

The term section 8 covers a wide array of subsidized housing. Yes the tenants should be treated like every other tenant (fair housing act anyone?). No they are not like every other tenant.
I have managed project based section 8, and have managed apartments that accept section 8 vouchers. These people are supposedly held to a year lease, but HUD will not allow you to go after them if they break thier lease. You cannot hold them accountable for late fees. You have to give them 30 days to pay you back for damages...and if they don't, well, you can't send that to collections.
Yes you can charge them the difference. If market rent is $xx.xx, they may only receive $zz.zz as subsidy (this is based on their income). They are responsible to pay the difference. They are also required to report any...ANY...change in income every time it happens. So everytime they change jobs, lose help from HHS, or whatever, you have to redo the paper work.
Section 8 is a lot of paperwork, and HUD can be a pain (i.e. now i have to turn stoves and lights on for inspectors...they can't do it themselves..actually received memos on this from HUD). Good luck to all who start their journey into section 8.

2 DIFFERENT LIMITS HERE. One is the the amount the rent amount allowed by the s8 authority, the other is the amount paid by the s8 authority. In hardship cases, they will pay 100% of the allowable rent determined by s8 authority (based on market rents, but not equal to market rents in all cases). Ususally, it is some lower percentage paid by the authority, with the tenant picking up the remainder. Tenants and landlords are not supposed to work outside of the total rent amount, should that amount be lower than the market rents for the area. Many times S8 tenants have so much trouble finding willing landlords they offer over and above the allowable, this is to be off the record and is against the rules. It is totally independent of the ratio paid by the authority vs. amount paid by the tenant.

In the VA localities I have dealt with S8 authotires, you never know what the rent will be until the inspectior comes through. Many times this is very near the move in date. You usually have an idea, but nothing is concrete until the inspector signs off on the file. Also you may not even know the break down of S* vs. tenant. Frank

I agree with Scott here. Where we live (Minneapolis/St. Paul), a rental property has to be inspected and approved by the local housing authority just to be able to rent to Section 8. So, I'm assuming that if there are already Section 8 renters in this building, than those units have been approved safe by the Section 8 housing authority. Now some investors like having Section 8 renters (likely for the guaranteed percentage of rent), and others may not feel as excited about it. It likely won't be a deal breaker when trying to sell to an investor. Good luck!