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Landlords & Tenants

US Government Tenant Guarantee – Section 8

Section 8 tenants have their rent subsidized by HUD, which is the federal agency that administers subsidized housing funds to local public housing agencies (PHA’s). The PHA issues a Housing Choice Voucher to the tenant. The tenant has to find their own housing that meets the PHA and HUD minimum health and safety standards. Renting to Section 8 tenants is a great way to get a long term tenant and have your rent guaranteed. Most Section 8 tenants are low income families or seniors. They are more apt to stay longer because it is harder for them to find Section 8 housing. They pay their rent on time because they don’t want to lose their subsidy.

Fair Market Rents and Approval Process

You can find Section 8 tenants by getting your name on the list at the local PHA for free. HUD Section 8 tenants must make sure your property qualifies under the HUD guidelines. To find out how to make our property compliant, you can visit the HUD website. Typical online slots items that need to be fixed or repaired consist of the following:

  • Peeling or flaking paint
  • Roof leaks
  • Cracked or broken windows
  • Smoke alarms must installed and be in working condition
  • Water heaters must be strapped to code
  • GFI outlets must be installed in kitchens and baths, and there cannot be any missing electrical outlet covers or switch plates

The local PHA will come out and inspect your property. Your rents must be within the HUD fair market rent guidelines which are published every October by HUD. Typically, the rent must be /-10% of the fair market rents in your area. If your property and the fair market rent are approved, then you and the tenant must sign a lease. At the same time, you and the PHA must also sign a housing assistance contract for the same lease term.

Benefits to Renting to Section 8 Tenants

The following are benefits of renting to Section 8 tenants:

  • You know your rent is guaranteed by the PHA. They pay every month like clockwork.
  • Tenants pay their rent on time every month too because they don’t want to lose their eligibility. The government usually guarantees 60% to 70% of the tenant’s rent. The tenant is responsible for the remaining 30% to 40%.
  • You can rent your unit at fair market rental rate.
  • Your lease is guaranteed for a 12 month term. This way, you know you have income every month until the lease expires.
  • Tenants abide by rules and the eviction rates are lower. You retain eviction rights though.
  • There is no fee to list your property with the local PHA.
  • You have a larger pool of tenants to choose from.
  • Section 8 tenants are responsible for excessive damages, and you can collect damages from them. You are also entitled to collect a security deposit allowed under local rent laws.
  • If you have to collect damages, some local PHA’s will assist you with the costs.
  • Some cities offer exemptions and abatements to landlords who make improvements to their properties and offer low income housing. Check with your local city authority.
  • After the expiration of the lease, you do not have to renew it if you don’t want to.

Renting to Section 8 tenants is a good strategy because you have fewer vacancies and you are guaranteed rent. You may also receive tax benefits or abatements from your city. It’s a strategy that landlords should consider if they want to increase their pool of tenants and keep their units rented

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