I was talking to someone about Real Estate investing and they had mentioned that their mom recently acquired 4 Subsidized housing units. Does anyone have any experience with these. I’m located in between Baltimore and DC so their isn’t a shortage of people looking for it but as far as dealing with them as a landloard or finding it and the return on investment is it worth it?
I know people that make a lot of money renting out property. I don’t know anybody that make a lot of money renting out to subsidized housing. They may have 1 of 2 but it is not a thing I have seen anybody making a living doing.
What is subsidized housing? Isnt that section 8 tenants?
Yes, from what I understand you would be payed by the government and by the tenant. The government is covering part of the housing cost for the tenant so that they can afford to live there. In most areas there is a shortage of this for of housing but I also think to have rent controls. This is most my assumptions because I couldn’t really find any information on it.
There’s lots of information on it, just check some of the old threads here or just do a search for section 8.
They’re just like any other tenant. In general they tend to pay market rents or a little bit above which makes them somewhat attractive, but they do have their own share of headaches such as the yearly inspections and the requirements that any violations be fixed in 30 days (you can sometimes get extensions) or you will stop receiving the rent. If you have good clean units and maintain them, it’s not that big a deal.
This really has nothing to do with rent control. Actually if there was rent control, you probably wouldn’t need section 8 because the rents would be low enough that the tenants could afford to pay on their own.
Rent control works in the short term, but it’s not good long term because it just makes the situation worse. If people can’t earn a decent return, they stop investing and the housing stock deterorates and no new stock gets built so after a while things just get worse. Thankfully it’s gone in our state.
I thought but was insure. Section 8 is great if its not rent controlled, but then again what is great that is controlled by the government? Nada
All my tenants are Section 8 and I absolutely love them. My properties are in North Carolina and they are 3 bedroom, 2 bath units. My manager works closely with HUD to find suitable tenants. Once the tenant has been approved, HUD sends someone out to inspect the property and gives us a checklist of any items that need correcting before they will authorize payments. Mine usually have been minor. Fortunately, since my properties are located in a somewhat repressed area, most of my tenant’s rent is covered by the Government.
Like clockwork, I get a monthly check from HUD. Never late, always on time. If one of my tenants fails to keep up with their portion, all I have to do is notify HUD of the default and they threaten to cut off the tenants Section 8 status (I don’t have to be the bad guy). The tenants immediately clammer to make up their rent.
Because I have always purchased properties in foreclosure, I have been able to recoup my investment within 18 to 24 months. Section 8 is not as scary as everyone thinks. Just don’t purchase middle income properties for this purpose. If you are afraid of the areas, hire a manager that isn’t.
Just my 2 cents! 
All of my tenants are section 8 or rental assited in some way. Its probably the best way to go as far as guaranteed rent. I buy in low income areas so it makes sense forme to get section 8 tenants although sometimes they are harder to handle than a middle income worker but its hard to find those kinds of properties that cashflow.
Good luck
Would you say the rent compared to the price that you purchased the property for is better or equal to that of a normal property. The one area I was really thinking of was Anacostia in DC certain areas are under a revitalization project and almost all of it is Section 8 so I was going to see if I could find a property down there.
I personally only have experience with low income residential properties except for 1 commercial building I own. The most I can get through Section 8 on a 3 bedroom, 2 bath unit in my area in North Carolina is $525.00 per month. However, the most I have paid for a foreclosure is $14,000 (average is $6,000). You do the math!!! I guess I should add that I have a lot of mobile homes. I get as much rent for a trailer as I do for an actual house.
I’d say with numbers like that you have it made! Very nice!
Yeah! Mobile homes may not be glamorous, but the figures don’t lie! Woohoo!
I have mobiles around me too but they are actually way overpriced with the average single costing about 40-50k and lot rent being 500 per month