Should I accept Housing Voucher/Section 8 Tenants?

Should I accept Housing Voucher/Section 8 Tenants?

Section 8/Housing Voucher formHousing Choice Voucher tenants (or “Section 8 Program tenants”) are common in many jurisdictions in Northern Virginia. It is a federally funded and locally administered program to help low income families, the elderly and people with disabilities obtain safe and affordable housing from private landlords. A landlord usually first becomes aware of the program when a potential renter calls up asking “Do you accept housing vouchers or Section 8?”. The question is – should you?

Some landlords actively seek out Housing Choice Voucher tenants while others are less open to the idea. Yet others are totally against it for their rentals.

Apart from a landlord having had a bad experience with a voucher tenant there may also be philosophical reservations. A landlord may look at supporting the housing voucher program as helping someone in need as well as a civic duty (many voucher families have young children.) Another may feel it is a system with potential for abuse that creates dependency.

In Virginia you are (still) allowed to exclude tenants based on source of income in most if not all jurisdictions (as far as I know.) Hence your personal thoughts and experiences can be used to allow or disallow housing voucher tenants for your rental property (in other local jurisdictions like District of Colombia you are not allowed to discriminate based on income source as long as the tenant otherwise qualifies.)

Some things to be aware of with Housing Choice Voucher tenants:

  • The housing voucher amount is the maximum rental price permitted for the tenant. The voucher amount typically assumes the landlord pays for all the utilities. If you do not pay for utilities, the maximum rental amount may be adjusted downward.
  • During the lease term the tenant could have their support change (or lost altogether) based on changes in things like number of dependents and income.
  • The tenant is usually responsible for part of the rent – it could be 10% or 30% or any amount. The tenant portion may also change throughout the voucher period.
  • The housing authority has little responsibility beyond their portion of the rent. If the tenant damages your property or stops paying it is ultimately your responsibility. The housing authority could choose to terminate the housing voucher support for the tenant if issues arise. But they wouldn’t reimburse you for damages and you would have to evict if the tenant is unwilling or unable to pay or violate the lease in some other way.
  • The housing authority has to approve your property – your property has to meet Housing Quality Standards. Tight fitting screens on all windows, bedrooms have to qualify as bedrooms etc.
  • The housing authority will do regular inspections and will require timely repairs to things like chipping paint, broken window screens, moldy caulk, inoperable smoke detectors etc. Even if you feel the tenant is responsible for the damage the housing authority may deny paying their voucher share until repairs deemed essential are made.
  • You cannot increase the rent as you wish upon lease renewal. The housing authority has to approve the initial rent and any increases thereafter. You will have to support any increase and rental amount with rents in the area.

Some recommendations:

  • Be careful paying utilities. There is no incentives for the tenant to conserve water, electricity or gas if you do. If the tenants leave the hose outside running all day in the summer you are responsible. If they take two hour hot showers or invite their friends over to do laundry all weekend, you are responsible. If the toilet is running for months and they don’t tell you, you are responsible for the water bill (proving otherwise will be hard and expensive.) This advice would go for any tenant, housing voucher or not – do not pay for utilities!
  • Check rental references, credit and verify sufficient income for the tenant portion of the rent.
  • Address in the lease what happens if the tenant loses the voucher support.
  • Do not require or accept any money above the maximum voucher amount unless you are sure you are allowed to do so. Do not accept any money or make any secret deals “under the table” that the housing authority is unaware of.
  • If the tenants are acceptable and qualify you can charge whatever security deposit you would normally charge (but no more than 2 months rent. ) The tenant pays the security deposit, not the housing authority.
  • Keep in mind that the current landlord may have an incentive to get rid of the tenants. They may be planning to sell the home or just want to get rid of a trouble tenant. A distressed landlord may say anything to get rid of a bad tenant. So, the tenant prior to the current one will likely be a better person to depend on. This advice applies to any tenant, housing voucher or not.

A Section 8/Husing Voucher tenant may make a wonderful and longterm tenant. But, as with any tenant you want to make sure you are aware of the particularities up front and do your background checks like you would with any other tenant. As income and credit may be spotty, checking the rental references thoroughly will help ensure you get tenants that will care for your home. Driving by their current rental home, speaking to their current neighbors or doing a home visit may give you an indication on how they will do as tenants.

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