Leasing to Section 8 Tenants

If you’re an investor in real estate, especially in a large metropolitan area, you might have considered opening your rentals to Section 8 tenants. This federal program assists those with low incomes to find housing by subsidizing a portion of their monthly rent.

As a landlord, there are pros and cons to accepting housing vouchers. So, before you make the decision to do so, it’s wise to thoroughly research what to expect.

Key Takeaways

• Section 8 properties provide much-needed affordable housing to low-income families.
• Section 8 housing is nearly always in demand and may have long waiting lists. 
• Before purchasing property to use as Section 8 rentals, it is essential to be aware that the building must pass an inspection by the U.S. Department of Housing and Urban Development (HUD). 
• Landlords must follow strict HUD procedures when it comes to evicting tenants. 
• Families must meet eligibility guidelines to be awarded Section 8 housing.

What Is Section 8 Housing?

The Housing and Community Development Act of 1974 established the Housing Choice Voucher Program, which was an amendment to Section 8 of the Housing Act of 1937. This program assists low-income renters by providing vouchers that pay approximately 70% of their monthly rent and utilities.

Section 8 housing is overseen by the U.S. Department of Housing and Urban Development (HUD), and it is administered by public housing agencies (PHAs) in every state. PHAs determine Section 8 eligibility for their area based on income and family size.

In general, a family’s income must be below the 50% median income for their area to qualify for Section 8, but this can vary based on the city and the state. Because demand for Section 8 vouchers is so high in many areas, the waiting lists can be very long. Some families wait many years to receive assistance.

Note

Local PHAs may close their waiting lists—for example, in Los Angeles County, the waiting list was closed as of February 2025.

Once a family receives their Section 8 voucher, it is up to them to find a suitable property that accepts Section 8 tenants. Local PHAs normally have lists of such properties, while websites such as GoSection8 make it easy to search for rentals by zip code. The housing voucher generally covers 70% of standard rent for that area, with the family responsible for paying the remaining 30%.

Benefits of Section 8

Rent Is Paid on Time

One of the biggest perks of renting to Section 8 tenants is having 70% of your rent paid right on time each month. If you have struggled in the past to collect rent from tenants, you can count on partial payments on every unit.

Payments Are Deposited Monthly

The government will deposit your portion of the rent money right into your bank account on the same day each month.

No Shortage of Tenants

There is a huge need for affordable housing across the U.S. Waitlists for Section 8 properties are a testament to that fact, so you should have ample potential renters. Owning Section 8 property in an area where rentals tend to sit vacant for lengthy periods can be beneficial.

Challenges of Section 8

Extensive Property Inspections

Before you can accept renters, your property must pass an extensive inspection by HUD personnel. If your property is deemed insufficient, you have 30 days to make necessary corrections before being reinspected. After the initial inspection, your property will undergo repeated inspections, generally on an annual basis.

Rent Is Capped

The local PHA determines the fair market rent for your unit, which is the maximum you can charge. Plus, the rent cannot be more than 40% of a prospective tenant’s income. This often leads to Section 8 landlords charging their tenants less than they could a non-Section 8 tenant.

Evictions

While you are entitled to evict Section 8 tenants, you will need to follow HUD procedures to do so. HUD is usually more restrictive than the local eviction process. So if you are concerned about the potential of difficult evictions, this is something to consider.

How Do I Rent to Section 8 Tenants?

In order to rent to Section 8 tenants, you must apply for a permit from your local Public Housing Authority. This will require an inspection of your building. Once you are approved, you may start interviewing tenants who are planning to use housing choice vouchers to pay their rent.

Who Are Section 8 Tenants?

Section 8 tenants are individuals and families who meet the income thresholds to use housing choice vouchers to pay part of their rent.

Can Any Building Be Rented to Section 8 Tenants?

If you buy a building you plan to rent out to Section 8 tenants, you will need to make sure it meets all the local building codes and passes an inspection by your local Public Housing Authority.

The Bottom Line

Whether you are new to the world of real estate investment or an old hand, at some point you are likely to consider opening your property to Section 8 tenants. Before making the decision, it is prudent to arm yourself with knowledge of both the good and the bad about renting to this particular niche.

Only you, along with your property manager, can decide whether the pros outweigh the cons in your particular situation. If you do decide to move forward, it’s good to know that you’ll be providing safe housing to families who need it.