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Pros and Cons of Being a Section 8 Landlord


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I definitely like renting to Section 8 tenants as part of my rental property investing strategy. If you’re a landlord and have not considered this, I suggest you look into it. The biggest benefit is that the local Section 8 office pays a large percentage of the tenant’s rent, which makes it easier to collect from tenants because they have less to pay. Plus, Section 8 payments are always electronically deposited right on time every single month without fail.

It also makes raising the rent easy, because you will communicate this with the Section 8 office, not with the tenant directly. This is critical because part of your long-term strategy should be to increase your rent roll every single year. This will steadily boost your cash flow each year, and will allow you to command a higher price when you sell.

Another benefit is that Section 8 tenants are more reliable and better behaved than non-Section 8 tenants. The reason is that most cities have a huge waiting list for Section 8 benefits, and therefore existing Section 8 tenants do not want to put their benefits in jeopardy.

Now, obviously there are a couple of downsides to Section 8 as well. For example, you will have to deal with an additional inspection every year, which tends to be more thorough than your CO and insurance inspections. Also, you will have to deal with more paperwork, and you’ll have less flexibility with your tenant leases. However despite these downsides, the benefits of Section 8 are far greater.

To get started, obtain a list of apartment / inspection requirements from your local Section 8 office. You can find your local office at the HUD website. This will allow you to understand the applicable requirements so that you can make your own decision whether or not a Section 8 angle makes sense for you. If it does, then you’ll just need to complete their landlord application, make sure the unit meets all the requirements, schedule an inspection with the office, and then rent to a Section 8 approved tenant.



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