Why Now is the Time to Buy Section 8 Rental Properties

By Lex Levinrad

If you’ve been paying attention to the real estate market over the last few years, you’ve probably noticed some dramatic shifts. Between the post-COVID price surge and today’s market corrections, we are now in one of the most unique rental property environments I’ve seen in a long time.

In this article, I’ll walk you through why the current market offers exceptional opportunities for rental property investors, how to identify and secure the best deals, and why cash flow—not location—is king.

The Post-COVID Price Surge

From 2020 to 2022, housing prices skyrocketed. Many markets saw jumps of at least 50%, and some areas experienced increases of 70%, 80%, or even 100%.

This rapid appreciation made finding cash-flowing rentals almost impossible. Prices were too high compared to rents. But the price surge wasn’t the only aftershock of COVID.

The federal government injected trillions into the economy through programs like EIDL loans and PPP loans. With so much money in circulation, demand for everything—from homes to luxury watches—spiked. The inevitable result? Inflation.

Rents Caught Up—And Then Some

Inflation pushed up not just home prices, but also rents, food, fuel, and other essentials. In my own portfolio, rents rose dramatically. A property renting for $1,300 a month climbed to $1,475, then $1,550, and eventually $1,675 in just a few years.

If you want to see exactly what Section 8 is paying in your area, check out the HUD Fair Market Rent Tool on my website at www.lexlevinrad.com/hud. It’s free and works nationwide. Select your state, county, and city to view rents by ZIP code.

Why Location Isn’t Always Everything

You’ve probably heard the real estate cliché: location, location, location. While location matters, it’s not the most important factor for rental investors.

Here’s why: if you buy a property in a great neighborhood but overpay and it doesn’t cash flow, you’re losing money. On the other hand, a less “prestigious” neighborhood with low prices and high rents can produce strong, steady returns.

When buying rentals, you’re not living in the property—your tenant is. Your decision should be based on cash flow and return on investment, not where you’d personally want to live.

The BRRR Method: Build Equity and Cash Flow

Instead of buying at retail, my students use the Buy, Repair, Rent, Refinance (BRRR) method.

Here’s how it works:

1. Buy at a Discount – Target motivated sellers: foreclosures, probate, tax delinquencies
2. Aim to buy at 50–60% of After-Repair Value (ARV).
3. Repair and Renovate – Update the property to make it ready to rent.
4. Rent It Out – Secure a strong tenant (often through Section 8 for higher cash flow and predictable income).
5. Refinance – Once the property is stabilized, refinance at 75% of appraised value to recover your investment capital—often all of it.

Example:

• ARV: $200,000
• Purchase Price: $110,000
• Repairs: $30,000
• Total Invested: $140,000
• Appraised Value: $200,000+
• Loan at 75% LTV: $150,000
• Result: All cash back, $50,000 in equity, and positive monthly cash flow.

Why Now Is the Time to Buy Rentals

Two major factors have created a rare opportunity:

1. Prices Are Down – Many markets have dropped 15–30% since 2022 highs.
2. Rents Are Up – HUD rent amounts have risen sharply due to inflation and the increase in Section 8 rents.

This combination means deals that didn’t make sense two years ago now produce strong cash flow.

Overcoming the “I Don’t Have the Money” Problem

Money isn’t the biggest barrier—finding the right deal is. Good deals attract funding. 

Options include:

• Private lenders
• Joint venture partners
• 401(k) loans
• Home equity lines of credit
• Business or personal credit lines

In my coaching program, I often lend my own money to students for the right deals. But whether you work with me or not, the point is this: with the right property, capital will find you if you know how to buy a property at 50 cents on the dollar.

The Window of Opportunity in Section 8 Rentals

Foreclosures, short sales, and bank-owned properties are increasing. More distressed properties are hitting the market at the exact same time rents are at all-time highs. This is creating an excellent opportunity for new real estate investors. And the opportunity is getting better every day!

If you learn how to find properties and employ the BRRR method, you can:

• Lock in properties with built-in equity of $50,000 or more.
• Generate $500–$600/month in positive cash flow on each property
• Own an asset that appreciates over time while your tenants pay down the mortgage
• Have properties that are owned free and clear in 15 years or less (if you use a 15 year fixed rate mortgage)
• You will have passive income and financial freedom for the rest of your life.

Final Thought: The perfect storm for rental investing is here. Prices are down dramatically in some areas. Section 8 rents are up a lot. And many sellers are now motivated to sell at a discount. Don’t wait until the market shifts again—learn the BRRR Strategy, find deals from motivated sellers, and start building lasting wealth for you and your family  today.

If you’d like to learn the BRRR method in detail, see real-world deals, and meet other investors and students of mine that are doing this right now, join me at my next Buying Rentals & Building Wealth Bootcamp which is coming up next weekend. 

More Details about the boot camp at https://www.lexlevinrad.com/buying-rentals-building-wealth-boot-camp/ 

Only 3 preview seats left for the boot camp. Call (561) 948-2127 To Grab One Of Those Seats