Does anybody here have experience with the Section 8 process. Is it a good Idea for a landlord of single and multi-family properties? What is the benefit other then having a tenant that doesn't want to blow a good thing? What are the downfalls I can expect? I know the home/units have to pass some sort of inspection regularly, which isn't a problem, but how rigid are these inspections?

How does this program work as far as total rents? Let's say you have a rental that is leasing for $1000 per month on the open market... that's not what you'll expect under Section 8, right? What would it likely be? $800, $875, $950?

I'm not sure how this works, but I need to learn fast. Any advice would be greatly appreciated. Thanks! -Cory

You might benefit greatly by finding out WHO the Section 8 Manager is in the local area that you're considering, and having a short conversation with that person.

Most of these people are quite approachable, and you can get these answers and more BEFORE investing in an area or type of investment that is new to you.

Ask him/her what the biggest problems are in managing the Program in your area. They will find it helpful as it will be seen as eliminating problems before they even come into existence.

If the telephone number for Section 8 Housing isn't clearly shown in your telephone directory, then call the local office of your US Senator or Congressman. That's why they are there, and it's their job to guide you to this information.

http://www.hud.gov/local/index.cfm?state=ca&topic=renting

Section 8 will depend on what rents they set for the are for payment and also what is the waiting list look like.

Some areas there is no more demand for section 8 so they are not taking more landlords.

We own a property that we lease under Section 8 funding. In my area the housing authority has the required inspection checklist posted on their website and the entire process is pretty self explanatory. You list you property in their system, tenants that are qualified and given a voucher contact you if they are interested in the property, you choose the tenant, proprety has to be inspected and the housing authority determines fair market rental rate dependent upon the immediate market and what utilities lender vs tenant will pay. They issue their contract with you, you also have your own contract with the tenant and the MAIN benefit is you receive payment directly from the housing authority not the tenant. Our area is direct deposit.
The limiting factor is the amount of funding available for section 8 by the local housing authority. In my area most people are on a waiting list for 2 years before they have an oppotrunity to be considered for the program, so once accepted they really dont want to break the rules and lose their section 8 funding.

Yeah and the 2 years doesn't even include waiting for the list to reopen again.

If the list is closed you have to keep checking back until they open it again. Then if you are lucky you will get on the list and wait 2 years.

Just like any government program funding is low and demand is high for low income people. It's mostly timing and the luck of the draw.
On the rent when the tenants are getting a free ride they certainly don't want to get kicked off that gravy train.

Section 8 programs are administered on a local level and they can vary greatly. I live on Long Island (NY) and have rental properties in Scranton (PA). Here on Long Island, Section 8 rents do not come close to market. In Scranton, they pay closer to market, but you have very little leverage over bad tenants.

I live in Alabama, and I try my best to get Section 8 tenants. Currently, I only have two properties with section 8 tenants and they have been great. They key is to screen each tenant very carefully. The only thing that I hate is the "turn around" time. It usually takes a long time to attract a section 8 tenant, obtain approval from their counselor, and have the property inspected and cleared. If you are like me and have a mortgage, time is critical. Overall, I must say that the guaranteed rent checks provide a peace of mind that is well worth the inspections and other nuances.
To see what screening process filtered out the bad tenants, read my number 4 on this page.
http://www.beginreal-estateinvesting.com/tenant-screening.html

There are definite advantages and draw-backs. The benefits are that the bill-payer is the government so you'll never have to kick them out for non-payment. The downside is that they are incredibly difficult to deal with from an inspection point of view. Every time they come, regardless of what the actual apartment looks like, they will find something wrong with it - these repairs can add up pretty quickly. I've had tenants purposefully break things just so I wouldn't get paid. Those are extreme cases but it does happen.