The federal government is committed to addressing the nation's affordable housing crisis by allocating billions of dollars toward housing programs annually. Section 8 housing is one of these initiatives.
The benefits of this program extend beyond providing houses for low-income families, though. Landlords can also benefit under the Section 8 program, provided they charge a reasonable rent.
Read on to find out how to sign up for guaranteed income and good tenants through this worthy initiative.
How Does Section 8 Housing Work?
In Indianapolis, eligible households enjoy access to two main Section 8 programs to help them navigate the pricey Indianapolis rental market. These are:
HUD-Veterans Affairs Supportive Housing (HUD-VASH) Program
HUD-VASH adds case management and clinical services to the HUD voucher program for qualifying veterans. VA medical centers and community-based outreach clinics support this program.
Housing Choice Vouchers
Recipients under this program receive vouchers to help them pay rent on privately owned units in Indianapolis. They pay at least 30% of their annual adjusted income toward utilities and rent, and the program pays the rest.
Landlords and tenants can apply for this program via the Indianapolis Housing Agency (IHA).
Qualifying for Section 8 Benefits
The IHA vets families who wish to apply for housing vouchers to determine whether they meet the financial criteria. Landlords should still conduct the usual tenant screening for these tenant applications before they rent accommodation to them.
Under Section 8 regulations, landlords must submit their properties for a housing inspection and charge a reasonable rent to qualify as a housing provider. In return, they receive a guaranteed part-payment of their rent.
Section 8 tenants must take good care of the properties they occupy and pay their portion of the rent on time to remain eligible for the voucher program.
How Does an HUD Rent Reasonability Assessment Work?
The HUD conducts rental market analyses to determine average rents per unit size for specified sub-regions in Marion County. This allows them to calculate fair market rent (FMR) for your property.
Once they've determined this figure, they make adjustments to accommodate tenant-paid utilities and arrive at a figure for reasonable rent.
A tenant may not pay more than 40% of their adjusted income toward rent; the HUD voucher program pays the rest according to a payment standard set for each unit size in the market.
Currently, the HUD pays between $1,374 and $2,551 per month for Section 8 housing. So, you can charge rent up to 40% more than this amount.
Is Being a Section 8 Landlord Right for You?
Provided you can meet the rental property compliance standards and rent reasonability rates, being a Section 8 landlord can alleviate the stress of rent collection and reduce rental vacancies. An experienced property manager can help you decide on the best route for you.
PMI Meridian has the skill and technology to help you manage your rental units effectively, find good tenants, and enjoy excellent profits. We offer a full range of property management services and specialize in personalized service for our clients.
Browse our blog for more landlord guidelines and discover more ways to maximize your Indianapolis investment properties.
