According to the Center on Budget and Policy Priorities, over 2.28 million U.S. households use Section 8 or Housing Choice Vouchers (HCV).
Many Section 8 users are in Topeka, KS. So, as a landlord here, consider renting out to these families. Doing so can increase your tenant pool and give you a more predictable rental income, with the federal government backing the vouchers.
However, to participate in the program, you must first meet Section 8 rent guidelines, including reasonable rent criteria. PMI Advisory Group provides critical insights into this matter, so read on.
How Does Section 8 Work?
Section 8, or HCV, helps those eligible for the program to afford decent housing in the private market, including:
- Low-income families
- The elderly
- Individuals with disabilities
While the federal government operates and funds HCV, local Public Housing Authorities (PHAs) administer it. In Topeka, KS, the administering agency is the Topeka Housing Authority (THA).
Factors Influencing Rent Assessment
In an article published by CJOnline.com in July 2024, the THA CEO said that Topeka has a housing shortage and needs about 4,000 more units for home ownership and rentals. It means there's a massive demand for landlords who can offer their properties to tenants who rely on Topeka housing assistance vouchers.
So, what then are Section 8 eligibility criteria, and how does the rent determination process go?
Fair Market Rent (FMR)
PHAs, including the THA, calculate FMRs for various areas, usually by city or metropolitan statistical area (MSA). Their calculations help them determine the maximum allowed rent.
Comparative Market Analysis
Section 8 assesses rents by analyzing comparable units in the area and their rental pricing averages and trends. Comparable units are similar in:
- Size
- Condition
- Amenities
Location
The neighborhood's desirability can heavily influence rent. Areas with the following positive attributes can command higher rents:
- Good schools
- Low crime rates
- Proximity to essential services (e.g., fire and police departments and hospitals)
The Importance of Reasonable Rent
Establishing reasonable rent is crucial because it allows landlords to market rental properties to more prospective renters. Collecting fair market rent also helps minimize the risk of evictions due to non-payment.
For tenants, paying rent deemed reasonable can prevent them from housing instability or financial strain. It helps them avoid becoming part of the growing problem of homelessness in the U.S., including Topeka.
How to Ensure Rent is Reasonable
If you're a landlord wondering how to align your rent with Section 8 requirements, consider the following:
- Conduct regular market research to stay updated on local rates
- Work with a reputable property management firm experienced in Section 8 regulations
- Foster positive relationships with tenants to promote communication regarding any concerns with rent
Ready for Section 8 Tenants?
Understanding how Section 8 assesses rent is essential for anyone involved in this program, whether tenants seeking affordable options or landlords looking to attract potential renters.
If you're ready to accept Section 8 tenants, our full-service property management firm, PMI Advisory Group, can help. Supported by PMI, a fast-growing national franchisor with over 20 years of property management expertise, our team brings local knowledge and extensive experience to your table.
Speak with us today to ask about our services or request your complimentary property rental analysis!
