A better question is to ask: Why not rent to a Section 8 tenant? Or maybe: What is Section 8? I’m glad you asked.
What is Section 8?
Established by the Housing Act of 1937, Section 8 was designed to help low income families receive help to rent housing. An individual or family can qualify by meeting certain requirements. That qualification then sticks with the family in the form of a Housing Choice Voucher, which can be taken from rental to rental. It can be revoked for various reasons, but as long as it and the landlord are in good standing, the landlord will receive a check from a local Section 8 public housing agency to subsidize a portion of the rent. The tenant is responsible to pay the remainder (usually 30% of their monthly income).
Section 8 is sometimes used to broadly talk about anyone getting rental assistance, but this is incorrect. There are a multitude of other assistance programs, government and non-government, which subsidize rents. They will have different requirements. Section 8 does too. Landlords must follow them or risk losing the funding source.
Section 8 Downsides
Landlords accepting Section 8 tenants need to have a minimum standard of quality at their property. This includes basic functionality, like plumbing and lighting. The units will have to be inspected and pass. These can have a lot of nuisance repairs, like light bulbs, but could also require some big expenses. Generally, these are sensible for the functioning of the rental, but they will be required in a timely fashion, which can sometimes be a challenge.
Additionally, when purchasing a new property, it can take a few months to get set up to receive Section 8 payments. It’s a little scary to have tenants living in the property and not getting rent while the paperwork is going through some government basement. But, once completed, you’ll get a check for the back rent.
Some people worry that Section 8 tenants are going to be more likely to damage their property. I think this is probably not the case. The quality of your rental and management is much more likely to have an effect here.
Section 8 Benefits
Tenants who are the recipient of a voucher generally depend on it to have a place to live. They do not want to do anything to jeopardize this. As such, they are going to be more likely to follow the lease agreement and keep the property in good condition.
The rental check from the housing authority is almost guaranteed. That’s a little bit laughable to say now that we are in a government shutdown lasting 1 month. Payments may be delayed but I really doubt they will not get paid in the end. The shutdown is and will be a big headache, though.
The Bottom Line
Some municipalities and states require you to not discriminate based on Section 8, though the Housing Act does not. It’s very important you look at your local laws. You may not be able to simply decline because they are on Section 8.
A better way is to put together a tenant qualification policy which has cutoffs for credit and rental history. Make sure you don’t violate the fair housing laws. Once you have put this together, stick to it.
