There are many local and federal programs that help individuals and families with low incomes afford safe, decent and clean rental homes in which to live and raise their families.
One of the largest housing assistance programs is the federally funded Housing Choice Voucher program, commonly known as Section 8.
Knowing how the program works can help open up a new group of tenants for your rental property, dispel some myths about the programs and the people it helps, and provide stability and consistency for you and your renter.
Here are the basics to be aware of.
What is a housing choice voucher?
A housing choice voucher is a form of rent subsidy that helps low-income individuals, families and seniors.
A home is generally considered affordable for a family if the family spends about 30% of their monthly income on it. The amount of the voucher is determined by the renter’s income and the market rate of their rental home.
For instance, a family with a monthly income of $1,800, using a Housing Choice Voucher, would generally pay $540 a month — or 30% of their income — toward rent. If the market rent on their home is $900, their voucher would cover the rest, in this case $360. Anyone using a Housing Choice Voucher cannot be required to pay more than 40% of their monthly income for housing and utilities.
How do housing choice vouchers work?
The federal program pays rent subsidies to private landlords through a network of 2,100 state and local public housing agencies across the country. Tenants who qualify for the program are screened and are often placed on a waiting list until funds become available.
Under the program, tenants pay a share of the rent, and the local public housing authority pays the rest directly to the landlord.
Landlords can still generally charge the same total rent, and use the same screening and leasing practices that they use for tenants who do not have vouchers. However, leases often must contain special disclosures related to Housing Choice Vouchers if one is being used.
Landlords also can make reasonable yearly rent increases to reflect market prices and maintenance needs, and seek evictions for significant lease violations
How do I start renting to tenants who use vouchers?
Probably the biggest difference in renting to tenants enrolled in voucher programs is the addition of an inspection process. The local agency that administers the vouchers conducts an initial health and safety inspection of the unit and then reinspects it annually to certify that it’s safe.
The inspections cover standard health and safety items such as smoke detectors, locks, plumbing and heat.
Before the lease is signed, the landlord files the lease and other required forms with the local housing authority for approval. Once approved, the renter can move in. The first payment typically takes a few weeks to set up, but once that happens, the landlord can expect consistent monthly payments to cover the subsidized portion of the rent while the tenant pays their share.
What are the benefits of housing choice vouchers?
Tenants can spend years on a waiting list before they’re screened and approved for a voucher, and they can lose their voucher if they violate the terms of their lease. Tenants who’ve gone through the process can be highly motivated to remain in the program, which could mean long-term tenants who follow the rules.
Other benefits:
- Landlords receive consistent, on-time monthly payments directly from the local housing authority that administers the voucher program.
- Tenants are pre-screened.
- Landlords have access to a wider pool of applicants who are able to pay the rent.
By renting to tenants with vouchers, landlords are helping provide affordable housing at a time when the need for such housing is critical.
Can I still screen tenants who use vouchers?
Yes. Voucher holders are pre-screened by their local authority, which is required to provide the results of that screening to landlords along with the tenant’s current and previous addresses, and the names and addresses of any known landlords who previously rented to the applicant.
Federal rules allow property owners to screen tenants for their rental payment history, care of their previous rentals and premises, respect for the rights of other tenants, and criminal history related to the health, safety and property of others.
As with all tenants, fair housing rules apply.
Can you evict tenants who use vouchers?
The rules for voucher tenants are basically the same as for any other tenant. Tenants who use housing choice vouchers to pay their rent, both during the initial lease term and for any renewals, can be evicted for good cause, which generally includes a serious or repeated violation of the lease agreement.
Can I refuse to rent to tenants with vouchers?
To ensure that every qualified renter has an equal chance at housing, a growing number of state, county and city governments are enacting laws to ban discrimination against renters based on their use of a voucher.
The measures — called “source of income” laws — are designed to protect renters whose income derives from public assistance, or in many cases, any legal source, including Social Security, child support, alimony or palimony, disability, and government housing programs.
Source of income protections — passed by many states, cities and counties across the U.S. — differ among jurisdictions, and some involve extensive protections and carry hefty penalties.
Landlords should familiarize themselves with the local and state laws that may apply to them.
Where can I find more information about housing choice vouchers?
Landlords interested in learning more about vouchers can contact their local housing authority.
