Section 8 Challenges

Solving Voucher Concerns

By Mike Sederholm on May 30, 2023 in News

Most housing assistance available through the Section 8 program is in the form of vouchers.

Officially titled Housing Choice Vouchers (HCV), these monthly rent supplements are available to millions of qualified households across the United States to the elderly or who earn very low income in comparison with the median of their community.

Households who receive HCV’s may find an apartment they like, sign a lease for whatever the market rate is for that unit, and then pay a portion of the rent on their own. The remainder of the rent, up to a certain amount based on local market conditions, is paid to the landlord via the voucher supplement.

HCVs are a great way to disperse renters throughout various parts of the community because they aren’t location based. They can be used to supplement rent payments in any unit that will accept the compliance mandates of the program.

Therein lies the main challenge of the HCV program: getting more landlords to choose to rent to households who intend to use a voucher as part of their monthly rent payment.

Work to solve this challenge is ongoing. Public housing agencies across the country are using strategies for their local landlords with varying degrees of success.

Jeff Bischoff, Yardi’s Senior Director of PHA sales recently spoke about the topic. Read on to hear his thoughts on the challenges of HCVs, and some of the ways his clients are solving them.

Tell us what you are hearing from clients about why landlords don’t choose to participate in the HCV program.

Bischoff: Landlords seems to be concerned with potential delays in contracting and rent collection. Like every other industry, owners and property managers operate on tight budgets and timeframes. Worrying about losing a month or two of income due to processing delays is enough concern to make some landlords opt to not participate.

Are those concerns valid?

Bischoff: There’s no denying that landlords should consider what’s best for their investments. However, that doesn’t mean opting to not accept HCVs is the only answer. There are ways to mitigate the financial risks of participating. We’ve also found that many PHAs are committed to driving and maintaining landlord participation by means of providing incentives. It’s great to see the commitment from the industry.

Some landlords seem to be concerned with the tedious inspection processes. How much effect do inspections have on lease-up times?

Bischoff: Most of the PHAs we work with know that inspection delays are worrisome for landlords. To help alleviate those concerns, PHAs prioritize inspections and understand the importance of communication to reduce lease-up times.

PHAs also leverage technology to promote communication between tenants, landlords and inspectors. For example, Yardi Maintenance IQ enables SMS (texting) and email communication between inspectors, tenants and landlords. An inspector can send recurring reminders to tenants and landlords to reduce no-show appointments and promote efficiency in the inspection process. Landlords also maintain their relationship with a housing authority through the Yardi RentCafe Landlord Portal, where they can communicate, share files and see detailed inspections results in real-time.

What does a unit inspection typically look for?

Bischoff: In short, HUD’s Housing Quality Standards (HQS) are clear and consistent – they look for adequate living space, sanitary conditions to prepare food, a healthy amount of light, ventilation and temperature control. An inspector does have to come out to verify these conditions, but what they are looking for is not over the top. PHAs can usually get this work done in a matter of hours. If no major repairs are required, it’s unlikely that a landlord would be missing any significant number of rental days just because of a required inspection. Yardi is in regular communication with HUD about NSPIRE (National Standards for the Physical Inspection of Real Estate), and will support it as soon as the protocol is finalized by HUD.  

What are some ways PHAs can increase landlord participation in the HCV program?

Bischoff: Certain PHAs provide incentives to landlords who begin to accept HCVs. The Housing Authority of the City of Santa Barbara is a great example. HACSB’s incentive list for newly signed landlords includes:

• Signing bonus for new landlords leasing up a Section 8 participant with a City issued voucher
• Available unit damage protection
• Referral bonus to the person referring a new landlord to the program
• Guaranteed prompt payment of the Housing Authority’s portion of rent
• Dedicated staff to answer landlord questions

Another example is Marin County, Calif., where financial incentives such as vacancy loss protection and assistance with security deposits mitigate financial risks for landlords renting to households with an HCV. The Marin County Board of Supervisors found that those types of incentives raised the rate of HCV acceptance by more than 22% over the course of three years.

In Cambridge, Mass., the local housing authority helps reassure landlords by making money available to pay for damaged units and for lost rent in case a unit becomes vacated without proper notice.

There is an excellent article from HUD’s Office of Policy Development and Research that gives more information on these types of programs.

Are there legislative efforts to help boost voucher acceptance rates?

Bischoff: Yes. Fair Housing laws exist to make sure that households can’t be denied the opportunity to rent a home based on many factors, including income levels. If a landlord denies an applicant because they have an HCV, it can be argued that they are basing the denial on the income of the applicant. Lawsuits and legislation are active, and, according to studies, have improved the likelihood that a household with a voucher is successful in finding a unit.

How does Yardi help PHAs attract and retain more landlords to the HCV program?

Bischoff: Solving challenges for our PHA clients is an opportunity for Yardi to develop innovative new technology. We’ve just launched a new component of RentCafe PHA called Online RFTA. With Online RFTA, participants and landlords gain access to digital workflows to complete the briefing and Request For Tenancy Approval (RFTA) process.

Traditionally, the briefing and RFTA processes are a sequence of events and forms that must occur prior to a household moving into a unit. With Online RFTA through RentCafe PHA, the workflows and forms are available digitally and can be completed and signed online by all parties. There’s no need to print, fax or send them through the mail.

RentCafe PHA touches nearly every step of the tenant lifecycle: it handles applying to join a waitlist, purging waitlists, qualifying and certifying for a voucher or unit, paying rent or repayment agreements, maintenance requests, and so on. Online RFTA takes that a step further by streamlining the process to execute a HAP contract with a landlord. The goal is moving families in more quickly – a win for all parties involved.

Where can PHAs learn more about Online RFTA?

Bischoff: Visit Yardi.com/RentCafePHA to see the features and benefits of Online RFTA. There’s a brochure available for download and a link to schedule a private demonstration with myself and/or someone from my team.