As an Arkansas landlord, you can consider leasing to Section 8 tenants. This program is funded by the federal government assisting low-income families in finding a rental home from the private market.

Before you decide if you want to participate in the program, here at Keyrenter Arkansas, we have put together an article discussing the pros and cons to accepting housing vouchers.

Before we begin, here are some things that you need to take note of:

  • The rental property must meet the sanitary, safety, and health requirements of the US Department of Housing and Urban Development (HUD).
  • Be aware of and follow the strict HUD eviction process.
  • Section 8 rental properties provide low-income family beneficiaries affordable housing options.
  • Section 8 housing almost always have high demand that translates to long waiting lists.
  • Beneficiaries must apply for Section 8 eligibility before they are awarded housing.

What Is Section 8 Housing?

Section 8 Housing or also known as Housing Choice Voucher Program was established by the Housing and Community Development act of 1974. This was a revised version of Section 8 of the Housing Act of 1937. It helps ensure that all individuals can afford housing. 

The Arkansas Section 8 program is funded by the federal government and aids low income tenants by providing housing vouchers that covers roughly 70% of the total monthly rent and utilities and will be paid to the landlord directly. The remaining 30% will be shouldered by the tenant.

family at home

Managed by the Arkansas Public Housing Authority, Section 8 eligibility is determined and then the housing vouchers are distributed.

To meet the requirement, the local government will assess their income, and determine their household size and nationality. In some scenarios, the elderly, families with children, and disabled are given special priority points.

Tenants are responsible for looking for a rental property that accepts Section 8 vouchers. The landlords can choose to receive Section 8 vouchers.

Benefits of Section 8

For you to fully decide if accepting Section 8 renters are worth it, you can find few of the benefits below:

Rent is paid promptly.

One of the challenges of being a landlord is collecting monthly rent. But, this won’t be that much of a struggle with Section 8 tenants as partial payment of the rent is sure to arrive on your account on time each month.

If you have been chasing payments in the past, this time you can count on the 70% of the rent paid monthly. You can expect this portion of the rent money to be deposited by the government to your preferred bank account on the same day every month.

Surplus of tenants.

Part of the Fair Housing Act is to provide equal housing opportunity to home seekers and with Section 8 Housing vouchers, there is a consistent demand on housing in the US.

moving boxes

Because of the overwhelming waiting list for Section 8 properties is an assurance that there are a lot of potential renters. Owning a Section 8 property can benefit you in the long run and can help you maintain a high occupancy rate.

Condominiums and houses may not be affordable for a lot of families or individuals, a Section 8 property can stand out in the market.

Section 8 Drawbacks

Considering the benefits is good, but being aware of the disadvantages of accepting Section 8 renters is also important.

Comprehensive property inspections.

Just like tenants, your rental property must also meet standard HUD requirements before you can accept Section 8 applicants. An HUD staff will conduct a comprehensive inspection and assess the safety, sanitary and health standards of your rental property.

If your property is found lacking, a re-inspection will be scheduled 30 days after you conduct reasonable house modifications. Once approved, your property will be subject to a regular inspection usually done on a yearly basis.

Rent ceiling.

Because Section 8 housing is being administered by the local PHA, they will also identify and assign the maximum rent you can charge.

When accepting Section 8 tenants, the cost of the monthly rent should not be 40% greater than the potential renter’s income. This may result in charging Section 8 tenants a lower monthly rent compared to regular tenants.

person holding money

Extensive eviction process.

Just like regular tenants, you have the right to evict a Section 8 tenant when they fail to fulfill their duties such as paying their share of the monthly rent, cause damage to the property and be a nuisance to other tenants. However, you have to be well-versed with the HUD eviction procedures and follow them.

Since the program’s goal is to provide assistance to families who may be in a challenging financial situation, HUD’s eviction process is stricter. If you are bothered by the possibility of a restrictive eviction process, this is something that you would want to think about.

How Do I Rent to Section 8 Tenants?

Just like Section 8 tenants, landlords must also go through the permit application process. The permit application must be done through your local Public Housing Authority. You should start the application process and set a building inspection schedule.

Once your PHA has approved your application and granted you a permit, you can start screening Section 8 tenants.

What Building Can Be Rented to Section 8 Tenants?

Before investing into rental properties or buildings to lease to Section 8 tenants, you must meet all Public Housing Authority building and housing expectations and requirements.

professional business man

Regardless of the type of property, it should be ready for the extensive inspection conducted by your local PHA. 

Bottom Line

Whether you are a seasoned or new landlord, you will have to think things through before considering renting to Section 8 tenants. Make sure to be aware of the Section 8 requirements and process.

If you need sound advice or want to take this burden off your shoulders, we can help at Keyrenter Arkansas. We can help you weigh out your options and help you decide if you should rent to Section 8 tenants. 

We will help you with this topic and more. Contact us today!

This blog should not be used as a substitute for legal advice from a licensed attorney in your state. Laws change, and this post might not be updated at the time of your reading. Please contact us for any questions you have in regards to this content or any other aspect of your property management needs.