How to Invest in Philly Section 8: Real Numbers, Smart Areas, and Tenant Screening

Philadelphia does not get enough credit in the affordable housing conversation.

When most investors talk about Section 8, they talk in hypotheticals. They talk about fear, stigma, or worst-case scenarios. In this episode of the Affordable Housing & Real Estate Investing Podcast, we do the opposite. We talk about real deals, real numbers, real neighborhoods, and real lessons from someone actively investing on the ground.

My guest, Jing Peng, is a full-time real estate investor, licensed agent, and general contractor operating primarily in Philadelphia. She owns and operates multiple Section 8 rentals, manages her own renovations, and has navigated inspections, tenant screening, rehabs, refinances, and cash flow in one of the most misunderstood housing markets in the country.

This episode matters because it answers the questions most investors are actually asking:

Can Section 8 cash flow in 2025?
How do you verify rents before you buy?
Which Philly neighborhoods work, and which ones you should avoid?
How do you screen tenants the right way?

If you are an investor, developer, or housing advocate who wants stable income and real impact, this conversation delivers clarity.

Why Is Philadelphia a Strong Market for Section 8 Investing?

Philadelphia is one of the largest affordable housing markets in the country, and demand continues to outpace supply.

Jing explains that Philly works because of three key factors. First, the city has clearly published Housing Authority rent charts that break rents down by bedroom count and zip code. Second, tenant demand is strong, especially for larger family units. Third, the city’s layout allows investors to stay close to their properties, which reduces operational risk.

She also emphasizes that investing in your own backyard matters, especially early on. Being within thirty minutes of her properties allows her to supervise rehabs, respond to issues quickly, and stay hands-on during inspections.

This is not about hype. It is about control, visibility, and execution.

How Do You Actually Determine Section 8 Rents in Philadelphia?

One of the most practical parts of this episode is how Jing verifies rents before buying.

Philadelphia publishes a Housing Authority rent chart that divides the city into four geographic rent groups. Each group has a maximum rent by bedroom count, based on zip code. Jing uses this chart before making offers, not after closing.

She also explains an important nuance many investors miss. Whether you receive the full listed rent often depends on tenant income. If a tenant has income, they typically contribute a portion of rent, allowing landlords to reach the maximum. If a tenant has no income, the Housing Authority may cover one hundred percent, but at a slightly reduced total.

This is why underwriting with conservative assumptions matters.

What Do Real Philly Section 8 Deal Numbers Look Like?

Jing breaks down one of her actual deals in Southwest Philadelphia.

She purchased the property for $120,000. The home had good bones and a high-ceiling basement, which allowed her to add two bedrooms and a full bathroom. Total renovation costs came in around $75,000 to $80,000, including a new HVAC system and a full basement buildout.

Timeline matters here. The rehab took about two and a half months. Section 8 inspection, paperwork, and tenant placement took another month to a month and a half.

After renovation, the property appraised at approximately $280,000. She refinanced at roughly 6.2 percent interest, pulled capital out, and now cash flows about $400 to $500 per month, even after reserving for CapEx.

This is not theory. This is executed reality.

How Do You Screen Section 8 Tenants the Right Way?

Tenant screening is where most fear comes from, and Jing dismantles that fear with process.

She lists her properties on AffordableHousing.com and also works with agents who specialize in Section 8 placements. These agents already have tenant pools and understand voucher requirements, which shortens vacancy time.

Before showing a property, she pre-screens tenants with basic questions. She pays attention to communication style, punctuality, and demeanor. If someone is late or unresponsive at the first interaction, that is a signal.

Her philosophy is simple. You are choosing who will live in your property for years. Treat it like a long-term relationship, not a transaction.

How Do You Avoid Contractor and Rehab Mistakes?

Jing’s advantage is that she operates as her own general contractor.

She explains that most rehab issues come from unclear scope and poor communication. Framing does not automatically include insulation. Finished basements require explicit safety considerations. Payment schedules, materials, timelines, and change orders must be written down.

Her biggest lesson is this. Put everything in writing. Scope, pricing, timeline, and responsibilities must be explicit. Assumptions are expensive.

She also emphasizes the importance of communication. Contractors must respond promptly, document progress with photos or videos, and be willing to explain their work.

Cheap bids often lead to expensive headaches.

Key Insights and Frameworks from This Episode

• Section 8 investing works best when rents are verified before acquisition, not after.
  

• Larger units in Philly command strong demand and stable voucher income.
  

• Tenant screening is about behavior and communication, not stereotypes.
  

• Renovation quality directly impacts rent ceilings and inspection success.
  

• Stable cash flow beats speculative appreciation in uncertain markets.
  
  

Best Quotes from the Episode

“The stable income of the monthly rent is really attractive, and I feel like I am doing something good at the same time.”

“How someone shows up the first time tells you a lot about how they will treat your property.”

“Cheap contractors can cost you more money and more stress in the long run.”

“You need to remove the stigma around affordable housing and analyze it through your own lens.”

“Section 8 is a niche lane, and most people never take the time to actually understand it.”

Common Questions This Episode Answers

Is Section 8 investing profitable in Philadelphia?
Yes, when rents are verified using Housing Authority charts and properties are renovated to inspection standards. Cash flow stability is one of the biggest advantages.

How long does a Section 8 deal take from rehab to first rent check?
Typically two to three months for rehab and about one to one and a half months for inspection, paperwork, and tenant move-in.

Do Section 8 tenants damage properties more than market tenants?
Jing’s experience shows that well-screened tenants are often appreciative and respectful. Process matters more than program type.

Which Philly areas should investors avoid?
Extremely high-crime areas like Kensington carry elevated risk and should generally be avoided, even if prices look cheap.

Do you need a lot of cash to start Section 8 investing?
No. Jing uses hard money for most of the purchase and rehab, with limited personal capital invested.

Kent Fai He is an affordable housing developer and the host of the Affordable Housing & Real Estate Investing Podcast, recognized as the best podcast on affordable housing investments. Each episode is designed to replace fear with facts and turn complex housing strategies into clear, actionable insights.

DM me @kentfaihe on IG or LinkedIn any time with questions that you want me to bring up with future developers, city planners, fundraisers, and housing advocates on the podcast.