I hope you have some takeaways from this blog. if you want our team to provide you tenant placement or property management. Click Here
Author: Mark Ainely | Partner GC Realty & Development & Co-Host Straight Up Chicago Investor Podcast

Let’s be honest: when most Chicago landlords hear "Section 8," they either lean in with interest or flinch with fear. And I get it.

But what if I told you that Section 8 housing, when approached correctly or with property management professionals on your team, can provide stable income, long-term tenants, and even help improve communities.

Section 8, officially called the Housing Choice Voucher Program, is federally funded but locally administered by the Chicago Housing Authority (CHA). The program helps qualified tenants afford rent by subsidizing a portion of their payment directly to landlords. This means landlords can collect a significant portion of the rent like clockwork every month, courtesy of the government (HUD).

The catch? You need to play by a different set of rules.

WHY SECTION 8 IS A SMART MOVE FOR MANY LANDLORDS

When we started GC Realty & Development back in 2003, we jumped into the section 8 program feet first and quickly we ran into unknown situations and expenses we were not prepared for.

But then, we got educated. We learned the system. We figured out how to work it for us, not against us.

Here’s what we found:

Rent payments are reliable: During COVID, guess who was still paying rent on time every month? Section 8.
You can't mess around with inspections: You have to pass otherwise if a unit fails two inspections in a row, you will stop getting rent or what they call “abatement”. Until you pass that inspection you will stop getting rent from CHA.
Must always screen applicants: You should screen a Section 8 applicant no different than you screen a market tenant. The rumor that is often spread is that CHA will underwrite the tenants, and that is far from the truth.
You can't collect rent above the approved contract amount: Early on we thought this was possible only because CHA tenants offered to do so in order to secure better units. Don’t collect rent above the approved contract rent!
High tenant demand: There’s a long waitlist (we are talking years) for vouchers in Chicago, and voucher holders are looking for landlords willing to accept them.
Stability: Voucher tenants often stay longer because they can’t just pick up and move — they’ve gone through a long process to get housing.
Don’t let CHA tenants move in before you sign a contract with CHA: “it is only a few days early” were the words I ate, and incurred a cost of over $5k! (I will go into this fascinating topic in a separate article).

These tricks, lessons, and hacks are just a few of many lessons you should know. This is a good start!

Keep in mind, when you factor in rising eviction protections and economic volatility, a steady check from the government becomes more attractive.

MISCONCEPTIONS THAT HURT LANDLORDS

There’s a lot of bad information floating around about Section 8 tenants. Let’s bust a few myths:

“They always trash the place.” Not true. We’ve had just as many problems (if not more) with market-rate tenants. Screening still matters.
“It takes forever to get paid.” If your paperwork is done correctly and your unit passes inspection, payments come on time. It’s a process — not a scam.
“I can’t raise the rent.” Section 8 has rent limits, yes — but they’re tied to Fair Market Rent. And many neighborhoods qualify for decent rates. Check out our article on requesting a rent increase.

The biggest mistake landlords make? Treating Section 8 tenants differently.

You’re still the housing provider. You still run your property like a business. You just have one extra player in the game: the Housing Authority. There is very little you will do differently managing a CHA section 8 tenant versus your market tenant.

WHAT LANDLORDS NEED TO KNOW ABOUT CHA INSPECTIONS

Before you can lease to a Section 8 tenant, your unit has to pass a Housing Quality Standards (HQS) inspection. This catches many landlords off guard.

Here’s what they’re looking for:

Working smoke and CO detectors
No peeling paint (especially in Pre-1978 buildings when lead based paint was banned)
Safe, functional appliances
Secure doors and windows
Proper water heater and furnace operation
Small, lesser known items that may surprise you

You’d be surprised how many units fail over things like a missing outlet cover or chipped tile in the bathroom.

Pro tip: Do your own pre-inspection or hire a manager who knows what to look for. At GC Realty, we walk every Section 8 unit before scheduling CHA — because delays cost money.

UNDERSTANDING PAYMENT STANDARDS AND RENT LIMITS

Every year, CHA releases updated payment standards based on bedroom count and zip code. These standards determine the maximum amount a landlord can collect — including both the tenant’s portion and the housing authority’s portion of the payment.

For example:

A 2-bedroom in the Austin neighborhood might qualify for $1,400/month.
That same unit in the Logan Square area could qualify for $1,800/month.

Rent reasonableness also plays a role. If your unit is outdated or priced too high for the neighborhood, CHA will push back. CHA is extremely intelligent when it comes to pricing the units.

Landlords need to stay updated. Each year, we review all our CHA rents and request increases where justified.

Have you heard of the CHA Mobility Program? Learn how you can get section 8 tenants at market rate rents in areas of the city you didn't imagine.

CAN I SCREEN SECTION 8 TENANTS EFFECTIVELY?

Yes, you can still screen tenants effectively. No, you cannot discriminate based on voucher status. What you can do is anything you do for market tenants which may include but not limited to:

Check credit
Eviction history
Public record reports
Criminal background checks
Call prior landlords
Check references
Confirm employment history (majority of section 8 tenants still work)
Check social media profiles
Require income verification (for the tenant portion)

Just make sure your criteria applies to all applicants. The Just Housing Amendment and Fair Housing rules are crystal clear here. Check them out at any time.

AVOIDING PITFALLS: WHERE CHICAGO LANDLORDS GET STUCK

The landlords who fail with Section 8 usually:

Skip inspections and delay move-ins
Assume “guaranteed rent” means “guaranteed no problems” … sometimes true, and sometimes not
Ignore tenant communication or skip renewal paperwork
Let repairs pile up, risking CHA violation notices which can cost loads of money

Section 8 works for those who treat it like a system — not a shortcut.

SUCCESS STORY: TURNING A TROUBLED UNIT INTO A CASH-FLOWING ASSET

One of our clients had a vacant 3-bedroom on the South Side area of the city of Chicago. Market tenants weren’t biting at $1,600. We promoted the property and attracted a section 8 tenant through the CHA Voucher program. Our client was hesitant, as many investors are at first, but it is always because they are not educated on the topic. That is where we help our clients learn the ins and outs as we have discussed in this article. This will help you catch the right tenants for your property.

What we did:

Underwrote the applicant and submitted all the paperwork
Had the unit inspected and in advance of the inspection we made repairs the unit to ensure we passed CHA/HUD standards
Facilitated the move in, and tenant has been there for 7 years now

The Result:

Rent started within 30 days
Tenant has become a long term tenant and friend to all
No missed payments have been made
Able to increase rent twice where it is now 20% higher then were we started and in line with other market rents in the neighborhood.

This client now wants us to place section 8 in all of their properties they have been buying.

HOW GC REALTY MAKES SECTION 8 WORK FOR INVESTORS

We’ve worked with hundreds of Section 8 tenants across Chicago and the suburbs. Our system includes:

Pre-inspections and repair oversight
Compliance with CHA paperwork
Screening that follows fair housing rules
Rent increase monitoring
Communication tracking with both tenant and CHA

This removes the stress for owners while keeping cash flow consistent.

WHAT AREAS IN CHICAGO ARE HOT FOR SECTION 8?

Any area rents line up with market rate leasing
Mobility zones

Look for properties in ZIP codes with higher payment standards and fewer landlord saturation rates.You can access this data online.

KEY TAKEAWAYS FOR CHICAGO LANDLORDS CONSIDERING SECTION 8

Know the rules, follow the process, and respect the program.
Screen every tenant thoroughly — but fairly.
Understand your market and set realistic rent expectations.
Keep your property inspection-ready.
Work with experienced partners who’ve done this before.

There is a lot of information contained here if you plan on investing in real estate locally. It may seem overwhelming for those wanting to invest in the Chicago market, but it is really just a team sport. Who is on your investing team? Do you even have a team? GC Realty & Development, LLC. has a dedicated team of professionals that are willing to share their decades of experience in all facets of real estate. We handle everything from Brokerage, Leasing and Property Management. Whether you hire us or not, we are happy to provide you with our resources and expertise.

What gets me up in the morning and keeps me going twelve hours a day is the ability to add value to local area investors, in Chicago and beyond! Those who connect with me often hear me say that our goal is to bring value to everyone we come in contact with. We hope that in return, they will one day hire us for our Tenant Placement,or Property Management Services, refer us to someone they know, or leave us a review about our services. We would clearly love all three, however, we are happy whenever we get the opportunity to help!

Reach out today!