Every year, the federal government allocates billions of dollars toward housing assistance for American citizens. Section 8 housing vouchers are a major part of these initiatives.
Section 8 allows qualifying tenants to rent private accommodation and pay the bulk of their rent via vouchers that they receive from the HUD. Landlords can sign up to offer accommodation under this program provided they meet certain criteria, like charging reasonable rent.
Read on to find out how this can benefit you and how you can become a Section 8 landlord.
Who Qualifies for Section 8 Housing?
Families who earn annual incomes below a certain threshold can apply to be waitlisted for Section 8 housing. Any landlord who owns rental properties may offer accommodation for the program.
The Douglas County Housing Authority (DCHA) manages this initiative in Parker, CO. Tenants and landlords should contact them for assistance.
The DCHA vets tenant applications based on income only, so landlords must still carry out all the usual tenant screening procedures for Section 8 tenant applications.
Landlords must agree to a property inspection to ensure their rental unit complies with housing standards and must charge rent according to specific criteria set up by the HUD.
Reasonable Rent Assessment Guidelines
Reasonable rent is calculated based on two predetermined amounts. These are:
Fair Market Rent (FMR)
Calculating FMR involves surveying housing in an area to determine the 40th percentile of rent prices for each unit size. This figure is a benchmark where 60% of local homes cost more to rent and 40% cost less.
The HUD excludes new homes, i.e., those less than 15 months old, and luxury homes from their market research.
Public Housing Agency (PHA) Payment Standard
This is the maximum amount a PHA will pay per the number of bedrooms in a rental home. Tenants may only occupy homes that cost this amount plus an amount equal to 30% of their monthly earnings.
The payment standard for an area is usually between 90% and 110% of the FMR.
An experienced property manager can assist you with a comprehensive rental valuation to help you determine fair rental prices for your Parker properties.
The Benefits of Being a Section 8 Landlord
When you have Section 8 tenants in your rental unit, you're guaranteed at least 70% of your monthly rent. Most Section 8 tenants pay their portion of the rent on time and take good care of the rental property.
If they don't, they stand to lose their benefits under this program and could be blacklisted by the PHA. A few calculations will soon reveal if the PHA payment standard for your home is enough to cover your costs while enjoying these benefits.
Make the Most of Your Parker Investment Properties
A property manager can help you calculate your potential earnings from Section 8 tenants for budgeting purposes. They're also familiar with all the intricacies of qualifying for this program.
PMI Parker offers a full range of property management services, including landlord compliance tips for Section 8 housing. We have many years of experience with Parker real estate and embrace the latest technologies to ensure you stay informed about the status of your investment properties.
Get on board with streamlined and efficient Parker property management services today.
