Investing in Section 8 Rentals: What’s In It For You?

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Couple outside a house for rentBuying a property that you can rent out is a good business decision, as it can be an easy way to make a profit. As the landlord, you may not have to deal with a lot of work, especially if you are fortunate enough to get good tenants.

But what if you or the property you want is in an area where the market for private pay tenants is low? The most common reason for this is that there aren’t that many potential tenants in the area who can afford to pay for a good home. A Section 8 rental investment could be the answer.

What is Section 8 housing?

The U.S. government came up with a plan to provide good public housing for low-income tenants during the era of the Great Depression, way back in the 1930s. Over time, changes were made to the original Section 8 housing program. Now it aims to subsidize housing for the benefit of Americans with low income.

Benefits of investing in Section 8 housing:

  • Guaranteed payments. As the government subsidizes the occupancy of tenants in your investment property from 70 to 100% of the full amount, you may have little or no problems collecting rent. If a tenant doesn't pay his or her share, you have the government’s backing to evict the tenant and find a replacement.
  • You can charge higher. Savvy Section 8 investors make a good profit, as they are able to charge a higher rent. Especially if you had to spend a considerable amount on fixing up the property, you may want to recoup the cost in a shorter time.
  • Your tenants are required to take good care of the property. The government requires Section8 tenants to treat rental properties with care and respect.
  • More tenants. Many low-income Americans need Section 8 housing, so it is unlikely that you’ll wait long before your investment is occupied.

If you would like to benefit from renting to Section 8 tenants, invest in such a property. Make sure you understand what it takes to be a Section 8 housing landlord. Inquire at a company offering such investment properties.

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