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An investor recently told me: “My house isn't Section 8 approved so I don't have to accept Section 8 applications.” He was partially right because he would need an inspection once he accepted a Section 8 tenant, but he was wrong in thinking he doesn't have to accept Section 8 applications. That said, there are three times Chicago landlords can legally decline Section 8. The bigger question is whether this is the right attitude to begin with.
Section 8 Basics
The Section 8 housing program helps low-income residents find healthy and safe housing within Chicago’s private market. The program uses federal funds from the U.S. Department of Housing and Urban Development (HUD) through the Housing Choice Vendor (HCV) program. A participating individual or family will receive a housing choice voucher with eligibility based on the family size and composition. A Public Housing Agency (PHA) will determine the payment standard based on a moderately priced house in the local housing market.
Who Runs the Section 8 Program in Chicago?
The Chicago Housing Authority (CHA) serves as the PHA for Chicago. CHA is the second-largest housing authority in the nation and the largest owner of rental housing in Chicago. CHA is funded by HUD.
Where is Section 8 Housing Available?
When you think of Section 8 housing, you might assume this only applies to specific neighborhoods or parts of town. But the program extends throughout Chicagoland. Qualifying tenants can rent homes from the North Side to the South Side and out to Oak Park. That means landlords across the city who accept Section 8 tenants can benefit from reliable rent payments, reduced vacancy periods, and the broader tenant pool.
Source of Income Anti-Discrimination Laws
The Illinois Human Rights Act, a portion of the Illinois Fair Housing Laws, requires housing providers to treat all applicants and tenants equally regardless of their source of income. Source of income can mean Section 8 rent, social security, and other subsidies willing to pay a tenant's portion of rent monies to the landlord. Housing providers cannot outright refuse to rent or sell to applicants with housing subsidies that require the housing provider to take additional steps to utilize the subsidy.
Why Section 8 Can Be A Smart Option for Chicago Landlords
In addition to low-income tenants in the program, landlords throughout the city benefit from Section 8 housing programs, especially those with properties in the identified mobility areas. Below are some of the many reasons why landlords should consider accepting Section 8 applicants.
1. Reliable Rent Payments
With Section 8, the majority of the tenant’s rent is paid directly by the government. This means landlords can count on consistent payments regardless of a tenant’s financial challenges. In addition, many landlords report that tenants remit additional payments over the voucher amount on time more frequently as well (as a stipulation for staying in the program).
2. Increased Demand
Anyone living in the Chicago area knows that the cost of living is high. That makes many turn to the CHA Section 8 program to help them find safe, affordable housing. There is no shortage of CHA voucher holders looking for places to rent, especially larger flats or single family homes in identified mobility areas.
3. Tenant Stability
As anyone who’s ever looked for a new apartment knows, looking for new housing and moving is both time-consuming and expensive. Those are two things tenants on a budget simply cannot afford to waste. Plus, with Section 8 housing in fierce demand, typically once tenants find desirable housing, they stick around longer. That leads to fewer turnovers costs in the long run for landlords to keep their units occupied.
4. Higher-Than-Market Rent Rates Possible
Landlords can potentially earn more for Section 8 housing than the market rate in certain situations, especially when the fair market rates set by CHA for vouchers is higher than the typical market rent for that area. And while Section 8 has traditionally been associated with only certain areas of town, landlords have found success throughout Chicagoland, thanks to the mobility program.
Generally speaking, all this means that landlords who accept Section 8 vouchers can potentially experience higher ROIs.
What is The CHA Mobility Program?
Part of the reason that Section 8 housing isn’t constrained to one area is the CHA Mobility Program. The Mobility Counseling Program looks to assist individuals and families who hold housing vouchers to find homes in high-opportunity areas, also known as mobility areas (as highlighted below).
These neighborhoods are characterized by:
Low Poverty: Less than 20% poverty rate
Safety: Comparatively lower crime rates and more secure neighborhoods
Quality Schools: Access to better educational institutions
Job Opportunities: Proximity to thriving employment hubs
Even more than finding housing in a desirable area, participants in the Mobility Counseling Program also attend workshops on budgeting, understanding leases, and tips on moving. Their counselors help them plan their move, find and apply for housing, and build a support network in the new communities.
By providing resources, education, and guidance, the program empowers participants to make informed decisions about their housing options, opening doors to areas they might not have considered or previously accessed. This initiative is particularly impactful for families seeking Chicago houses for rent in safer, more prosperous neighborhoods with better schools for their children’s education.
When Landlords Can Deny Section 8 Applicants in Chicago
Despite the Illinois Fair Housing Law and the potential benefits of accepting Section 8 vouchers mentioned above, there are three scenarios when a Chicago landlord can deny a Section 8 applicant.
The CHA Mobility Program pays market rates in most areas of the city and HUD has increased their rents overall. But sometimes the numbers just won't work. For example, a 3-bedroom townhome in Lincoln Park will get $4,000/month for market rent but CHA will not pay more than $3,000. The law doesn't expect these scenarios to work; therefore, a landlord can refuse to accept a CHA voucher.
As our friend in the opening story notes, to accept Section 8 applicants, you have to be Section 8 approved. That means a Section 8 inspection completed by CHA must find that your property meets the minimum HUD Housing Quality Standards(HQS) requirements. Sometimes expensive repairs to an otherwise code-compliant building may get in the way of passing a Section 8 HQS inspection. In those scenarios, the numbers just don’t make sense for the owner.
For many condos and townhomes, the Homeowners Association (HOA) controls external structure repairs or to common areas. Property owners may not be able to get the HOA to approve and complete the required repairs. For example, a couple of years ago, we failed an inspection because the elevator certificate through the City of Chicago wasn't updated. Although definitely outside of our control, CHA said they couldn’t pass our property until the building owner addressed the issue.
Sometimes it’s either outside the landlord’s control or it doesn’t make sense financially for a landlord to accept Section 8 applicants. At the very least, landlords should be able to demonstrate that their property falls into a scenario like the above to avoid Fair Housing Law violation accusations.
Minimize Risk with Professional Support
Section 8 housing in Chicago can be a win-win for landlords and tenants citywide.
For those landlords interested in accepting voucher holders, the CHA doesn’t necessarily make it easy. They have many hoops to jump through to stay compliant on building repairs, lease paperwork, and changes in rent portions. Risk versus reward??
Navigating Section 8 can feel overwhelming, especially for first-time landlords. From understanding inspections to marketing your property effectively, managing Section 8 tenants requires expertise.
Don’t let confusion about Section 8 or the risk of doing something wrong hold you back!
Partnering with a property management team like GC Realty& Development LLC ensures you’re fully compliant with the Section 8 process. We’ll handle all the initial and ongoing paperwork in addition to requesting rent increases with CHA.
Landlords who work with GC Realty enjoy steady income, fewer hassles, and better tenant retention. GC Realty offers:
Expert Guidance: Stay compliant with Section 8 requirements and avoid costly mistakes
Effective Marketing: Fill vacancies faster by attracting reliable tenants citywide
Hassle-Free Management: Focus on your investment while we handle the heavy lifting, from tenant screening to rent collection
Contact us today to learn how our expert property management services can make Section 8 work for you. The longer you wait, the more opportunities—and income—you could be missing out on.
