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We are Canadians and do not know the complete details on Section 8. We have recently purchased a couple of investment properties in Glendale, AZ. Our property management company has mentioned renting to Section 8 people as a potential good option as it is guaranteed rent. They also stipulated that the potential renters need to be properly screened prior to renting.
Is this a good idea? Can anyone comment on Section 8 and the good, the bad, and the ugly?
There is a lot of mis-conceptions about section 8 renters - and down right prejudices. The facts are, anyone receiving section 8 cannot have a history of felony drug charges, or a conviction involving violence against others or destruction of property.
For those who receive section 8, unfortunately, the reality is most of these families are in a class which is known as "generational poor"... which means many do not, due to cultural upbringing and lack of role models, aspire to be home owners, pursue careers [as opposed to jobs which are often minimum wage jobs] or pursue their educations beyond high school - if they got that far.
The result of this is: for better or worse, for these families, section 8 represents "living the good life" because their expenditures for rent are capped at 30% of their income when they are receiving section 8... w/o section 8 they would often be paying up to and over 50% of their income to rent.
Most section 8 tenants do not want to screw up a good thing. they only pay 30% of their income in rent. So if their income for the month is $900, they are required to pay $300 towards their monthly rent... if the rent is $1300, the tenant pays $300 and the government sends a check, like clockwork, for $1000 each and every month.
So if a tenant does bail, your potential loses are minimal. But most Section 8 tenants are not going to stop paying their portion of the rent, run a drug-selling business out of their hime [let's keep it real, some section 8 tenants may sell drugs on the side, usually just pot, but they usually will not allow drugs to be sold from their section 8 rented property.]
I work, professionally, with this segment of the population.... I know what the culture of section 8 is like, it's not middle class american culture and we can't expect it to be, but it's not all bad either and if I owned property, I would not HESITATE to rent to section 8 tenants.
Often, in areas where the rent prices work with what section 8 is willing to pay, because they do have limits on what they will allow section 8 tenants to pay in rent.... anyways, in the parts of town where section 8 is a viable option, if you don't rent to section 8 tenants, then your pool of potential renters will likely consist largely of those who do not meet the criteria for being section 8 clients.... they may have a recent felony drug history, or some other problem which bars them from receiving section 8.
so you are often better off going with section 8 tenants than taking your chances with the general population
There is a lot of mis-conceptions about section 8 renters - and down right prejudices. The facts are, anyone receiving section 8 cannot have a history of felony drug charges, or a conviction involving violence against others or destruction of property.
For those who receive section 8, unfortunately, the reality is most of these families are in a class which is known as "generational poor"... which means many do not, due to cultural upbringing and lack of role models, aspire to be home owners, pursue careers [as opposed to jobs which are often minimum wage jobs] or pursue their educations beyond high school - if they got that far.
The result of this is: for better or worse, for these families, section 8 represents "living the good life" because their expenditures for rent are capped at 30% of their income when they are receiving section 8... w/o section 8 they would often be paying up to and over 50% of their income to rent.
Most section 8 tenants do not want to screw up a good thing. they only pay 30% of their income in rent. So if their income for the month is $900, they are required to pay $300 towards their monthly rent... if the rent is $1300, the tenant pays $300 and the government sends a check, like clockwork, for $1000 each and every month.
So if a tenant does bail, your potential loses are minimal. But most Section 8 tenants are not going to stop paying their portion of the rent, run a drug-selling business out of their hime [let's keep it real, some section 8 tenants may sell drugs on the side, usually just pot, but they usually will not allow drugs to be sold from their section 8 rented property.]
I work, professionally, with this segment of the population.... I know what the culture of section 8 is like, it's not middle class american culture and we can't expect it to be, but it's not all bad either and if I owned property, I would not HESITATE to rent to section 8 tenants.
Often, in areas where the rent prices work with what section 8 is willing to pay, because they do have limits on what they will allow section 8 tenants to pay in rent.... anyways, in the parts of town where section 8 is a viable option, if you don't rent to section 8 tenants, then your pool of potential renters will likely consist largely of those who do not meet the criteria for being section 8 clients.... they may have a recent felony drug history, or some other problem which bars them from receiving section 8.
so you are often better off going with section 8 tenants than taking your chances with the general population
And for this we should be so proud of our government !!! Whatever happened to teaching people to work and pay for things ? I mean in the bible it says that a person who does not work does not eat . I have a real problem with people who dont want to work and the government pays their way so to speak .And then when the home that the government is paying for gets destroyed who pays to have it repaired the rest of us who are working and paying taxes for this sort of thing !!!
And for this we should be so proud of our government !!! Whatever happened to teaching people to work and pay for things ? I mean in the bible it says that a person who does not work does not eat . I have a real problem with people who dont want to work and the government pays their way so to speak .And then when the home that the government is paying for gets destroyed who pays to have it repaired the rest of us who are working and paying taxes for this sort of thing !!!
Ummm....I am wondering about the good and bad of renting out to Section 8 people. I did not ask about government policy, religious doctrine, and your issues with other people.
Here is my experience. Good deal if you have great on site management. If you are an absentee owner, bad idea.
The positives are you do have reliable rent, the tenant is still responsible for their portion and adhering to the rental agreement for timely payment, ect. It is not a program where you place your tenant and the checks just roll in. You still have the responsibility's of the landlord/tenant relationship.
Be careful that you have a screening criteria that applies to ALL applicants. Do not get yourself in trouble by even appearing to discriminate in any way. Good screening prevents problems no matter who you are entering a rental contract with. Good Luck. Ultra gives good advice IMO in these areas.
There is a lot of mis-conceptions about section 8 renters - and down right prejudices. The facts are, anyone receiving section 8 cannot have a history of felony drug charges, or a conviction involving violence against others or destruction of property.
For those who receive section 8, unfortunately, the reality is most of these families are in a class which is known as "generational poor"... which means many do not, due to cultural upbringing and lack of role models, aspire to be home owners, pursue careers [as opposed to jobs which are often minimum wage jobs] or pursue their educations beyond high school - if they got that far.
The result of this is: for better or worse, for these families, section 8 represents "living the good life" because their expenditures for rent are capped at 30% of their income when they are receiving section 8... w/o section 8 they would often be paying up to and over 50% of their income to rent.
Most section 8 tenants do not want to screw up a good thing. they only pay 30% of their income in rent. So if their income for the month is $900, they are required to pay $300 towards their monthly rent... if the rent is $1300, the tenant pays $300 and the government sends a check, like clockwork, for $1000 each and every month.
So if a tenant does bail, your potential loses are minimal. But most Section 8 tenants are not going to stop paying their portion of the rent, run a drug-selling business out of their hime [let's keep it real, some section 8 tenants may sell drugs on the side, usually just pot, but they usually will not allow drugs to be sold from their section 8 rented property.]
I work, professionally, with this segment of the population.... I know what the culture of section 8 is like, it's not middle class american culture and we can't expect it to be, but it's not all bad either and if I owned property, I would not HESITATE to rent to section 8 tenants.
Often, in areas where the rent prices work with what section 8 is willing to pay, because they do have limits on what they will allow section 8 tenants to pay in rent.... anyways, in the parts of town where section 8 is a viable option, if you don't rent to section 8 tenants, then your pool of potential renters will likely consist largely of those who do not meet the criteria for being section 8 clients.... they may have a recent felony drug history, or some other problem which bars them from receiving section 8.
so you are often better off going with section 8 tenants than taking your chances with the general population
Many good points...
I have never had a tenant receiving assistance deal drugs or other illegal activity... that I know of
I have had Section 8/Voucher holder become involved with boyfriends or extended family members that are no good... and therein lies one of the risk factors... there is a entire group of guys that prey on these young women.
Most single young women with or without kids have boyfriends... many of these boyfriends do not have a place of their own...
At the first of the month, when everything is fine and the checks go out so rent is paid and groceries bought... the guys are often no where to be seen... Fast Forward to the end of the month, when money is tight and all of a sudden the guys are back... it's a cycle I've seen repeated many times... no one puts out their boyfriend until after the first of the month...
I've seen it happen like clockwork at one building I managed that was predominantly Section 8...
I have never had a tenant receiving assistance deal drugs or other illegal activity... that I know of
I have had Section 8/Voucher holder become involved with boyfriends or extended family members that are no good... and therein lies one of the risk factors... there is a entire group of guys that prey on these young women.
Most single young women with or without kids have boyfriends... many of these boyfriends do not have a place of their own...
At the first of the month, when everything is fine and the checks go out so rent is paid and groceries bought... the guys are often no where to be seen... Fast Forward to the end of the month, when money is tight and all of a sudden the guys are back... it's a cycle I've seen repeated many times... no one puts out their boyfriend until after the first of the month...
I've seen it happen like clockwork at one building I managed that was predominantly Section 8...
I know this is an issue... most landlords choose to look the other way. But if the tenant isn't holding up her end of the bargain, the landlord knows he has some "negotiating power" in that he can always threaten to report the fact the boyfriend or "the father of her children", is living with her to Section 8.
Any woman who has a guy living with her while she's on assistance knows she's playing this game, and she will usually do her part to keep her nose clean and outta trouble so that you don't have a reason to pull the "I could report this to Section 8" card.
Along the same lines, most guys will carry their clothes with them or, if they have a car, keep their clothing and other personal items, in the trunk of the car.
As I said, I've been privy to an up close look at this lifestyle. Oftentimes the guys, if they are the father to children in the household, do pitch in and help with things such as clothes for the kids, or the expense of birthdays and holidays, pay fees for her kids to be in sports or other activities, perhaps buy baseball gloves and bats. If they have a car, the guy will oftentimes keep it maintained for her... It may not seem like much help to those of us who are used to a middle-class values of a father supporting his children buy paying the mortgage and putting food on the table, but the truth about how much these guys pitch in where they can is probably more than many outsiders would guess.
I'm not defending the lifestyle of generational poverty, I'm just saying this is the lifestyle most of these folks were born into and it's all they know.
The truth is, the kids usually know who their dad is, and, unless he's in prison, he's probably around more than you might think... and he's probably helping out more than you might think.
In this culture, it's ALL about survival... their rules of the game don't make sense to us, but really, if you understand and appreciate the fact they are living by the code of survivial... then it all kind of, sort of, makes sense.
For example, to address the part I put in bold in the above quote of your post....
The reason the guys aren't around at the beginning of the month is that they are not really needed, so they are told to move on.... towards the end of the month, when money is tight, the women have more incentive to allow the guys in their house, and often in their beds... the guys likely are helping make ends meet during that time of the month. Once the first of the month comes around, the monetary incentives to make nice with the guys wanes, the guys are told to move on out, and the cycle repeats itself...
Men in this culture are fighters and lovers. It's all they know. I am not saying it's right or wrong. I'm just stating the reality. No judgments, just understanding it for what it is... my heart is for the kids who don't have role models of achievement to pattern their lives after. Recommended reading: Ruby Payne's book "A Framework for Understanding Poverty"
Last edited by StPaulEastSider; 05-02-2009 at 09:52 PM..
And for this we should be so proud of our government !!! Whatever happened to teaching people to work and pay for things ? I mean in the bible it says that a person who does not work does not eat . I have a real problem with people who dont want to work and the government pays their way so to speak .
A lot of these people who receive DO WORK, they work minimum-wage jobs which, in turn, support your sorry lifestyle.
Don't think that's the truth? Think again...
Do you really want to pay the increased prices at convenience stores, grocery stores[not just the cashiers and stock boys, the farm labor], McDonald's, Walmart, your favorite coffee joint, etc, etc if these minimum-wage jobs were suddenly required to pay all their employees a decent living wage.
Not willing to go that route... fine pull out the rug, end the rent subsidy programs, and watch the economy head for a nose dive which will make this current recession look tame.
Do you really want to see the decrease in the value of investment properties which would result if these programs were removed and landlords would either let go of their properties altogether, or they would have to rent out their properties at a loss.
Knock out the rent subsidy programs, give everyone minimum-wage jobs - if they can even find that kind of work, and just watch what happens when the free market readjusts to account for what people can REALLY afford to pay in many neighborhoods with high numbers of section 8 renters.
For a landlord in a really rough section of town, section 8 usually pays MORE than the FMV for rental properties, section 8 actually keeps rental rates artificially high. Who do you think is really benefiting in this situation?
Methinks it's the investor who is getting more in rent for his property than he could otherwise, reasonably, expect to charge is the REAL winner in the section 8 programs.
Okay, I've had my say, as the OP said, he didn't ask the question to start a political debate. Just do me a favor, stop drinking the ditto head kool-aid and think about the realities of our society
"Talk to the Hand"
Quote:
Originally Posted by phonelady61
And then when the home that the government is paying for gets destroyed who pays to have it repaired the rest of us who are working and paying taxes for this sort of thing !!!
Section 8 Tenants, just like ANY OTHER tenant, pays a damage deposit when they move into a property. If the property is destroyed, the landlord keeps the deposit, just as he would if he was renting the property out to any market-rate tenant.
For the OP... this is a common complaint of landlords who do not want section 8 tenants. Going back 20 years, Section 8 used to reimburse landlords for damage done to their properties above and beyond what the damage deposit [usually one month's rent] will cover. Landlords were taking advantage of this program and falsifying damages to get monies to make improvements to their properties, or to line their own pocket.
Landlords with elephant's memories are still bitter over the loss of this government-subsidized "cash cow".
The Section 8 tenants I work with rarely get their deposits back w/o a fight... not because they destroyed the property, but rather because the tenants rarely have the confidence, or the documentation [they didn't take photos when they moved in] to confront a landlord in court who claimed unreasonable damages to a property. Most section 8 independant landlords, in my experiences, consider the damage deposit to be income they can use for operating expenses or profit, they have no intention of returning it... property management companies are better about doing everything "by the book". For this reason, when given a choice, I usually advise clients to go with a bonafide property management company rather than an individual landlord.
Last edited by StPaulEastSider; 05-02-2009 at 09:54 PM..
As a Landlord or Property Manager.... NEVER accept any additional rent money under the table or outside the Housing Assistance Contract...
You will be surprised how often this is offered... if accepted, the tenant now has something to hold over the landlords head and it's not worth it... in an extreme, it could be viewed as fraud against the government
Previously, Housing would guarantee the equivalent of 2 months rent in the event of damages... less what ever amount paid by the participating family... anywhere in my experience from $35 to a little over $300... Housing is now totally out of the security deposit business...
I have had many working families receiving assistance... one was a county bus driver making around 50k... the amount of her subsidy on a 3 bedroom home was $70 per month.... it really does vary greatly.
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Ummm....I am wondering about the good and bad of renting out to Section 8 people. I did not ask about government policy, religious doctrine, and your issues with other people.
Ultra gives good advice IMO in these areas
.
