According to Bankrate, about 3 million households rent residences in section 8.
Many families rely on Section 8 housing as they don't have sufficient income to afford suitable housing on their own. If you own Section 8 housing, you might not be too sure about how to price it. Section 8 rent criteria can vary from typical housing, so it's important to understand the rent evaluation process.
In this guide, we'll look at the factors that affect rent reasonability for Section 8 housing in Charlottesville, VA. Keep reading for more.
Understanding Section 8
Section 8 housing (also known as the Housing Choice Voucher Program) is a federal program designed to help people such as:
- Low-income families
- Individuals with disabilities
- The elderly
It makes it easier for them to afford safe, suitable housing. The fair market rents (FMRs) for different areas are set by the Department of Housing and Urban Development (HUD). These help guide landlords so they can determine the maximum allowable rent for Section 8 properties.
Determining Reasonable Rent
You need to follow Section 8 rental guidelines to ensure you set reasonable rent. The HUD uses various factors to determine reasonable rent standards.
Local Market Conditions
The HUD will look at the rental prices of properties throughout Charlottesville to gain a better understanding of what people typically pay in the area. They can then keep things in line with current market standards.
Property Size and Condition
When it comes to any rental property, its size and condition are among the most important factors, and this applies to Section 8 homes too. A property will tend to have a higher value if:
- It's larger
- It has more bedrooms
- It's newer
- It has been well-maintained
- It has an outdoor space
Utility Costs
Utility costs aren't always the most important factor when looking at property valuation, but it's still considered for Section 8 housing. Landlords need to ensure that the rates they set cover utilities, including:
- Electricity
- Heating
- Water
Rent Reasonableness Test
When you feel you've determined a reasonable rental rate, it needs to be approved by Section 8. They'll assess it to make sure it's suitable for the property and location.
Tips for Section 8 Rental Pricing
If you want to be successful and avoid issues as a Section 8 landlord, you should get it right from the start. There are a few things you can do to achieve this.
Stay Informed
Stay up to date with the local real estate market. Observe trends and FMRs that the HUD provides. Being informed will make setting reasonable rent much easier.
Maintain Your Property
A degrading property will quickly lose value. Make sure you maintain yours properly to ensure they hold their value so you can maximize your rental income.
Be Open to Negotiation
If Section 8 determines your proposed rental rate is too high, you'll need to be open to negotiation. Adjusting your rates or rental terms will help resolve the situation.
Simplifying Being a Section 8 Landlord
As a Section 8 landlord, things can get a bit complicated. Hiring a property manager is a great way to ensure things are done correctly, making life much easier for you.
PMI Commonwealth is a leading Charlottesville property management company. Our team has years of experience in the local market and uses the latest technology to provide exceptional service. Check out our property management page to find out more.
