It's estimated that half of all United States tenants struggle to afford their rent. This housing crisis doesn't just affect tenants either. Missed rent payments and evictions can also devastate landlords as well.
So what's the solution? One option that can work out for both parties is Section 8, also known as the housing choice voucher program.
But what exactly is Section 8? And how does the program determine that the rent you set as a landlord is reasonable? In this guide, we'll answer these questions so you can decide if becoming a Section 8 Denver landlord is right for you.
What Is Section 8?
Section 8 is a housing program designed to provide housing to low-income individuals and families. Here's how it works: landlords offer their properties under the program.
Then, when the people move in, the government pays for 70% of the rent, while the tenants cover the other 30%. In addition to benefiting the tenants, this program can also help landlords.
It provides guaranteed rental income, which in this day and age can be hard to find. What's more, since people are eager to retain their housing voucher you likely won't need to try hard to get a lease renewal.
And if they do move out, there's such a large candidate pool that you won't need to wait long to get a replacement. That being said, there is a lot of bureaucratic red tape and housing laws you'll need to deal with when you sign up for the program.
How Does Section 8 Determine If Your Rent Is Reasonable
Before you can begin renting, the HUD needs to make sure that the rent you're offering Section 8 tenants is reasonable. To do this, the HUD looks at a variety of factors surrounding your rental property including:
- The location of the property
- The overall quality
- The size
- The type of unit
- The age of the property
- Any amenities
- Whether or not utilities are included
The HUD will determine rent reasonableness when you join the program as well as periodically throughout.
How Can a Property Management Company Help You?
As we mentioned, there are a lot of bureaucratic hoops you'll need to jump through to become a Section 8 landlord. Besides setting a reasonable rental price, you'll also need to correctly file a lot of paperwork.
A property management company can help you by making sure that the rental price you are offering is fair. They can also assist you in filling out all the necessary paperwork.
Then, when the tenant moves in they can manage them entirely for you while making sure you don't violate any tenant rights. If you like being a hands-on landlord, you might not need help.
However, if you notice any of these signs, you should consider hiring a property manager.
Interested in Becoming a Section 8 Landlord? Contact PMI Aspire
We hope this guide helped you learn more about how Section 8 decides if your rent is reasonable. Here at PMI Aspire, we know that there are pros and cons to becoming a Section 8 landlord.
Regardless of your decision, we're here to help you. We can help you sign up for Section 8, or we can find you good tenants outside of the program.
If you're ready to make your life as a landlord easy, get in touch with us today.
