Crash Course on Section 8 Rentals

Lately I’ve been deep in the trenches of tenant screening and scheduling viewings. You meet all kinds of people, and I’ll probably write a full breakdown of my screening process soon. Specifically, how I think about mitigating risk as a landlord.

For now, I want to keep this issue shorter and focus on one topic that surprised me: Section 8 housing.

What I Thought vs. What I Learned

Section 8 is a federal program that helps renters by subsidizing part of their monthly payment. The tenant pays a portion, and the government covers the rest.

In short: it’s assisted housing.

In Michigan, a law passed in April 2025 made it illegal to discriminate against tenants based on their source of income. My initial impression was that every landlord had to accept Section 8 vouchers.

But I recently discovered there are exceptions:

• If you own 4 or fewer units, you’re exempt.

• If you’re “house hacking” (living in one unit of a building you’re also renting out), you’re exempt.

• If the majority of your income doesn’t come from landlording, you’re exempt.

In other words, mom-and-pop landlords often don’t have to take Section 8 vouchers if they don’t want to.

So once you know it’s optional, the question becomes: is it worth it?

Pros & Cons of Section 8

Pros:

• Guaranteed income. The government’s portion shows up on time, every time. If the voucher covers most of the rent, your cash flow is nearly automatic.

• Market-rate rents. Housing authorities set payments based on what’s considered “fair market rent” for your property type.

• Larger tenant pool. More qualified applicants mean less vacancy risk.

• Long-term tenants. Because voucher eligibility is reassessed when tenants move, many Section 8 renters prefer to stay put once they find a place.

Cons:

• More admin. Properties must pass an annual inspection, and dealing with the housing authority adds extra paperwork. Payments also come from two sources (tenant + government), which means more tracking.

• Tenant risk perception. I haven’t rented to Section 8 tenants personally, but if you browse landlord forums, you’ll see plenty of complaints about:

  • missed tenant portions of rent

  • property damage at move-out

  • general behavioral headaches

Whether those stories reflect reality or stereotypes probably depends on the tenant and your screening process.

The Takeaway

If you’re a landlord in Michigan, you may not be required to accept Section 8. Deciding whether you should accept it comes down to weighing the trade-offs.

For some, guaranteed payments and a wider applicant pool are worth the extra steps. For others, the inspections, paperwork, and tenant concerns make it a hard pass.

Either way, understanding the rules is the first step—so you can make the call that fits your goals as a landlord.