In our previous post we have talked about the Section 8 of the Housing Act and what you need to know about it as a landlord. Well, you got the idea and now is the time to decide whether you should get involved or not. Our specialists at Bay Property Management Group have put together some pros and cons of renting to Section 8 tenants, so that you could make an informed decision. Let’s talk about the benefits first.
Receive payments on time
You are guaranteed to receive at least a portion of the rent (anywhere from 50% to 90%) on time every month. It will be paid by the Department of Housing and Urban Development (HUD) and can even be deposited straight into your bank account – no excuses about why the rent is late.
Access to a large pool of applicants
As a Baltimore property management company we know that Section 8 housing is hard to come by in many areas, which makes your Section 8 approved property a highly desirable place for many applicants. Plus, you can take advantage of the free advertisement offered by the local public housing offices, as well as online at Gosection8.com. In this market where demand for affordable housing is typically higher than supply, you will be able to rent out your property rather quickly.
Extra cushion in case of tenant’s inability to pay
Things happen. A tenant may lose a job, receive a disabling injury or experience other financial hardships that would prevent him or her from paying the rent. While normally you would have to evict such tenant and go through the trouble of finding a new one, HUD may cover all the rental expenses of a Section 8 tenant who temporarily lost their source of income.
As a landlord renting to a Section 8 tenant you receive a certain degree of protection from a housing authority that issues people Section 8 benefits. A housing authority can terminate tenant’s voucher for many reasons, including failure to pay rent, violation of the lease or eviction from the subsidized unit. So, if your Section 8 tenant is a nuisance to the neighbors, doesn’t maintain the property or is causing other sorts of trouble, you can contact the housing authority and present the evidence. They will help you either to discipline the tenant or evict them.
You help people
Let’s forget for a second about your rental profits. When you are renting to a Section 8 tenant, you are helping a struggling single mother, a disabled war veteran or someone else who can’t afford to pay the full rent. You might not be making as much money, but your effort to better someone’s life is worth something.
Considering all of the above-mentioned benefits, it’s fair to say that in most cases renting to a Section 8 tenants means a long and stable partnership:
– you are guaranteed to receive a certain percentage of rent;
– your tenant is motivated to pay his part to keep the place and stay with the voucher program;
– moving is more complicated for a Section 8 tenant than for everyone else, so they tend to stay in one place longer;
– to a degree, you can rely on a housing authority to discipline a tenant.
Of course, not all of the Section 8 tenants are equally pleasant and mindful of your property. As far as property management in Baltimore goes, we’ve seen both good and bad Section 8 tenants. You will need to put them through a thorough screening like you would any other tenant. We will talk about the drawbacks of renting to Section 8 tenants in our next post. Stay tuned!