You’ve probably heard ‘Section 8’ mentioned before.
But what exactly is it?
And is it a good idea to have Section 8 tenants?
Section 8 is a US Government housing voucher program.
It is managed by the Department of Housing and Urban Development.
The scheme provides assistance to hundreds of thousands of families in need of affordable housing.
When people apply for Section 8 they are means tested.
If they are approved, the US Government will pay their rent in part or in full – depending on their income.
Tenants are then issued with a voucher and they can choose any rental property they like up to a certain rent per month.
The program is used by millions of property investors in the USA to earn profits every month.
5 things you should know about Section 8
Section 8 is not just for families who don’t work for a living
Section 8 helps thousands of families who have jobs but need some assistance with their rent.
For example, people on low incomes, single parents, people with health issues and the disabled etc.
Section 8 has no time limit
As long as your property passes the annual Section 8 inspection, the US Government will keep paying you.
Section 8 does not lock you into a government contract
You sign a normal, 12-month lease with your Section 8 tenant.
There is no obligation on your part to keep renting your property under Section 8.
If 3 years down the road you want a non-Section 8 tenant because you can make more money from them, you can just cancel your contract.
And when you want to sell your property, all you have to do is give your tenants 60 days notice and you are free to sell.
There is a huge shortage of Section 8 approved homes
In many areas there is a huge shortage of homes with Section 8 approval.
In Detroit, for example, over 4,000 new Section 8 vouchers were recently issued and over 8,000 families are now on the waiting list for properties.
Most Section 8 approved properties are rented within a week of becoming available.
Section 8 tenants will look after your properties
Section 8 tenants are obliged to maintain your property in good condition and pay their share of the rent on time.
If they fail to do this they will be evicted from your property and black-listed from the Section 8 program for life.
Once black-listed, they cannot reapply for Section 8 anywhere in the USA.
For this reason the vast majority of Section 8 tenants are very good tenants.
What about Non-Section 8 tenants?
Of course, it’s your choice whether you accept Section 8 housing tenants.
You may prefer to charge a higher than average market rent or to rent to private individuals only.
But if you don’t want to take Section 8 tenants, for whatever reason, you need to be sure there is a sustainable tenant base in the area where you invest.
For an up-to-date list of investment properties in Detroit (ALL fully refurbished and tenanted) just reply to me.
Let’s have a quick look at a few that are available right now.
Minock Park is in Northwest Detroit next to upmarket Grandmont-Rosedale.
It is a 20 minute drive from downtown Detroit.
The neighbourhood is popular with home owners and tenants because it has a very low crime rate.
This means demand for housing is high.
And property prices and rents are rising fast.
So you are likely to benefit from strong capital growth.
This property is opposite Stoepel Number 1 Park.
And a 10 minute walk from the shops, banks and restaurants on Fenkell Avenue and Grand River Avenue.
This house has 3 bedrooms, 1 bathroom, a living room, a kitchen, a 600 sq. ft. basement and a 4,356 sq. ft. garden.
It is on offer for US$ 64,995.
Your monthly rent is US$ 930, paid by Section 8.
Your net yield is 13.31%.
That’s US$ 8,649 in your bank account every year.
Want full details?
Simply reply to me.
This property is 800 meters (0.5 miles) from the shops, banks and restaurants on Fenkell Avenue.
Murphy Elementary-Middle School is only a 3 minute drive away and Detroit Leadership Academy and Harding Elementary School are a 5 minute drive.
This house has 3 bedrooms, 2 bathrooms, a living room, a kitchen, a 600 sq. ft. basement and a 5,837 sq. ft. garden.
It is on offer for US$ 59,995.
Your rent is US$ 956 per month, paid by Section 8.
Your rental yield is 15.49% net.
That’s US$ 9,294 in your pocket every year.
Want to know more?
Just reply to me.
Osborn is in Northeast Detroit and borders upmarket Grosse Pointe and Harper Woods.
It is 16km (10 miles) from Downtown Detroit or a 15 minute drive.
Many people living in Osborn work in Eastpointe which is just a 5 minute drive from this property.
This is because property prices in Eastpointe are much higher than in Osborn.
But it also means demand for housing in Osborn is high.
And this is already starting to push up property prices and rents.
So you are likely to benefit from strong capital growth.
This property is only 900 meters (0.6 miles) from the shops, banks and restaurants on Seven Mile East.
Flemming Elementary School and Turning Point Academy are a 4 minute drive.
The house has 3 bedrooms, 1 bathroom, a living room and a kitchen.
There is also a 650 sq. ft. basement and a 5,576 sq. ft. garden.
This property is on sale for US$ 61,995.
Section 8 pay your rent of US$ 866 per month.
Your net return is 13.10% – after all expenses.
That’s US$ 8,125 in your hand every year.
If you’d like to know more – simply reply to me.
Remember all our USA investment properties are:
- Fully renovated – average cost of works US$ 20,000
- Freehold with full warranty deed
- Already tenanted with pre-screened tenants – you get paid from day one
- Professionally managed – your rent is paid on time into your own bank account
Plus, with our Detroit properties you get all this completely free:
- Free Title Insurance – value US$ 499
- Free 1 year Property Insurance – value US$ 495
- Free 12 month Home Warranty – value US$ 700
Total value = US$ 1,694.
I won’t offer you unrealistic guarantees which can’t be fulfilled, like some people I could mention.
But I do promise you…
- Your vacancy rates will be very low (last 3 years 3.58% average)
- You will always get paid what you are due
- I will stay right by your side for as long as you own your property
It doesn’t matter if it’s 3 months or 30 years – if you have a problem I’ll be here to help.
Because I know that if you get the returns you are expecting you’ll come back for more.
You might even refer your friends and family, if I’m really lucky.
And unlike many of my competitors I don’t charge you a finder’s fee, an enabling fee or an arrangement fee.
In fact I don’t charge you any fees at all.
So if you’d like full details of what’s on offer in Detroit – just reply to me.
Comments are closed.