THE PROS & CONS OF SECTION 8 HOUSING

THE PROS & CONS OF “SECTION 8” HOUSING

By Gary Link, Attorney at LawA member of our advisory team

Do you remember the 1989 movie with Harrison Ford called Indian Jones and the Last Crusade? In one of the final scenes of the movie when Walter Donovan (Julian Glover) was attempting to ascertain which silver chalice was the cup of the Holy Grail, the ancient guardian Knight warned the actor to “Choose Wisely” He pondered between various cups on display, and chose the shiny, glittery, glamorous cup…claiming that surely this was the cup of the King. He was wrong. It was the wrong cup. He failed to choose wisely.

After over 25 years of representing landlords and property managers, my opinion is that the Housing Choice Voucher Program (formerly “Section 8”) program is metaphorically like the shiny cup.

The 2004 edition of the SHRA booklet states that the benefits to the landlord are (1) free advertising to voucher holders, (2) competitive rental rates, (3) full property control, (4) stable cash flow, and (5) motivated tenants who will fear loss of eligibility if the tenant fails to comply with the housing standards.

Many people have shared that they absolutely love the “Section 8” program for a variety of reasons, predominantly that all or a portion of the rent is paid by the SHRA, they obtain apparently motivated tenants, a long term/fixed lease, and housing quality standards that must be met. It sounds great, doesn’t it? What a deal!

But, as Paul Harvey says “How, let’s look at the rest of the story!”

I want my clients to be fully informed, and to have rationally and carefully considered options and consequences before making their choices. My law practice involves representing landlords. In meeting with thousands of landlords and property manages I have always felt great sympathy for the many times that my clients have moaned, groaned, cried, and shed a multitude of tears in my office when confronted with issuers relative to “Section 8” housing situations, and their distress in attempting to rapidly evict tenants who are violating the terms and provisions of the rental agreement.

Like the Knight in the movie, I also want my landlord clients to “Choose Wisely.” So for your careful consideration from my experiences, please consider the following reasons when making your choice as to whether you will enter into a “Section 8” contract:

1. The HVCP contract cannot be terminated by the simple and mere issuance of conventional thirty or sixty day notice of termination of tenancy. The owner must “give the tenant a notice that specifies the ground for termination.”

2. After the fixed term period of tenancy, the rental agreement still cannot be terminated except for cause, or in certain circumstances only upon the issuance of at least a Ninety Day Notice of Termination of Tenancy.

3. The terms of the tenancy cannot be easily changed during the fixed term. Conventional month-to-month rental agreements allow for rent increases and rental changes with only a few minor limitations.

4. The terms of tenancy cannot be changed without advance permission from the Housing Authority. Conventional rental agreements do not require advance permission.

5. The amount of rent that may be charged cannot exceed the acceptable and approved guidelines set by the Housing Authority. If the landlord wishes to increase the rent to an amount higher than the approved guidelines, it is prohibited.

6. The landlord must give the Housing Authority a copy of any owner eviction notice at the same time the owner notifies the tenant. This means that a separate copy must be served on the Housing Authority.

7. The Notice of Termination of Tenancy or a special attachment to the lawsuit for Unlawful Detainer must articulate the “good cause” reasons why the tenancy is being terminated. For obvious precautionary reasons, the Notice of Termination of Tenancy and/or the attachment with special language is something that only an experiences attorney should prepare. This cost more money and time to accomplish.

8. The probability of collection of the unpaid rent against the former tenant is essentially zero.

9. The probability of collection of cleaning and repair costs for witch the tenant is responsible is essentially zero.

10. The property is not even eligible to be rented unless authorized by an SHRA inspector.

11. The property is continually subject to additional and annual inspections by an SHRA inspector. If the property does not muster to the Housing Quality Standards, then the Housing Authority can turn off the faucets of rent subsidy payments…which means that you won’t receive what is often the “lion’s share” of the rent that you are expecting from the Housing Authority.

12. “Section 8” eligible tenants are more likely to receive free legal assistance than conventional housing tenants.

13. “Section 8” eligible tenants are more likely to seek judicial delay relief by the filing of requests for a stay of execution claming financial hardship in being evicted according the normally prompt timelines.

14. Even if the SHRA stops the subsidy payments, the landlord cannot use that reason as a “good cause” basis to terminate the tenancy.

15. The Housing Authority may terminate program assistance for the family for any grounds authorized in accordance with HUD requirements.

16. The owner is responsible for screening the family’s behavior of suitability for tenancy. The 2004 booklet says that “The PHA is not responsible for such screening.”

Everything that glitters is not gold. Even the shiny cup. Choose wisely.

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