Quote:
Originally posted by Porsche-O-Phile
There's also a reason for this. Upstate New York has no resources, no appeal and no jobs. You'd be lucky to earn $600 a month living there. Why on earth there's a rent floor is totally beyond me. I've heard of rent control (rent ceilings, not that I particularly agree with 'em) but never a floor.
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The government creates a rent floor. Section 8, through a voucher program, has maximum allowable rents for a given metro area and x number of bedrooms. Basically, HUD is saying,"I will pay the rent you ask, landlord, as long as your price is at or below Fair Market Rent."
What happens is landlords will buy crappy 35k houses, rehab, and then rent out via Suction 8 (emphasis on the sucking). Outside of Section 8, this house might fetch $510/month. Inside Section 8, this house will get fair market rents of say $820/month. HUD knows this is going on, and they encourage it. This program has waiting lists, and HUD needs more rentals to fill the need.
If you want to be filthy stinking rich, Section 8 might be a good place to look. It does require a strong stomach. I have resisted the lure. The program needs reform and it has bred a way of life.
Just run the numbers. Any person with motivation and some sense could own 10 Section 8 properties free-and-clear in 10 years. $820/month x 10 properties x 12 months = roughly $96k/yr gross, which isn't shabby for a part-time job. In reality, though, it isn't an easy job. A bad experience with Section 8 or a bad tenant can cause you to wonder about the future of the human race.
rent on,
jurgen