The Differences Between Market-Rate and Affordable Housing
If you’ve been involved in the housing industry for any period of time, you’ve probably heard the terms “market-rate housing” and “affordable housing.” But what exactly is the difference between the two? Don’t worry, we’ll break it down for you.
Market-Rate Housing
Market-RateHousing is also known as conventional housing. This just means that the property does not have any type of subsidy, and the resident pays the full amount of the rent that is determined by the market.
Attributes of Market-Rate Housing:
The lease terms are customizable
No restrictions on additional services and fees you are able to provide to the tenant
You can non-renew a lease for any reason
The rent is not guaranteed (residents may or may not pay, might be late on rent)
Late payments/refusal to pay could lead to eviction
You can create your own screening criteria
There’s no limit on the rental amount that you can charge
Rent is dictated by what someone is willing to pay for the unit
If you want to check out our available market-rate properties, click here.
Affordable Housing
Affordable Housing is also known as subsidized housing, meaning that the property is receiving a subsidy from a governmental agency whereby the resident is only responsible for a portion of the rent. This portion of the rent that they owe is typically based on their income.
Attributes of Affordable Housing:
Lease terms are subject to the agency issuing the subsidy
The rental subsidy payments may be subject to property inspections from the agency
You are limited in reasons for non-renewing a lease
The rent is guaranteed by the agency issuing the subsidy
Your screening criteria is also dependent on the agency that’s issuing the subsidy
The rental amount is dictated by the agency that’s issuing the subsidy
There are income restrictions for residents to qualify
If you want to learn more about the different types of Section 8, check out this blog post.
If you want to check out our available affordable housing properties, click here.
All in All
Whether the property is market-rate or affordable housing, our primary goal is still the same: to provide safe and habitable housing for all of our residents, as well as professional management services to meet our clients’ goals for any property that we manage.
We have 40+ years of expertise in all aspects of housing in and around the Pittsburgh area, Western Pennsylvania, and West Virginia, so if you have any questions, feel free to contact us!
It’s likely that you’ve heard of Section 8 housing, or its two subcategories, but do you know exactly what it is?
According to this article on www.hud.gov, the Section 8 Housing program is “the federal government’s major program for assisting very low-income families, the elderly, and persons with disabilities to afford decent, safe, and sanitary housing in the private market.”
Oftentimes, there can be confusion regarding the Section 8 program, who qualifies for Section 8 housing, what it means for owners and their rental properties, and more.
Today, we’re going to try to clear up some of that confusion for owners and tenants by discussing Section 8 and breaking down the two housing programs – Section 8 Vouchers and Project-Based Section 8 Housing – that fall under that title.
Program #1: Section 8 Voucher Program
The first type of Section 8 housing is the Section 8 Voucher Program.
A Section 8 Housing Choice Voucher is a type of housing assistance that will pay a portion of the rent that is charged on a unit.
The Voucher is awarded by the local Housing Authority to a qualified applicant and can be used at any rental property that accepts Section 8 Vouchers.
Who Qualifies for the Section 8 Voucher Program?
There are income and household composition requirements that must be met to qualify, but the applicant should contact the local housing authority for more information on those requirements.
Accepting Vouchers as a Property Owner
If you’re a single-family rental property owner, you can agree to accept these Section 8 Housing Vouchers if you so choose. If you do, you will receive all or some of the rental payment directly from the housing department every month.
Many rental property owners in Pittsburgh find this to be a good strategy because it’s guaranteed rent. You won’t have to chase down residents for late rent or missing payments because you know exactly where the money is coming from – a government agency.
However, even though your rent payment is guaranteed, there are still some hoops to jump through when you accept Section 8 Vouchers at your rental property.
Your property will have to undergo several different types of inspections. If there are any habitability issues, you’ll need to fix them right away – otherwise the Voucher program will not approve you for participation.
Additionally, there can be delays with rent payments, especially if there’s a government shutdown.
There can also be a difference in market rental values. With a market-rate property, you can set the rent at whatever you want; as long as the market will bear what you’re asking, you’ll get the rental price you ask for. But with a Section 8 Voucher, you are limited to what the Section 8 program determines is the acceptable rent rate for your property.
Does Arbors Management Accept Section 8 Vouchers?
Arbors Management will accept Housing Choice vouchers for the properties that have Low Income Tax Credits attached to them: The Meadows Apartments and 38 West Prospect Road in Washington, PA.
We do not accept Vouchers for our Project-Based Section 8 or PRAC (Project Rental Assistance Contracts) properties because there is already a deep subsidy attached to the unit itself. If an applicant has a Housing Choice Voucher and moves to a Project-Based Section 8 or PRAC unit, the applicant will lose the Voucher.
When looking for housing with a Section 8 Voucher, please be sure to check with your leasing agent to see if the owner will accept a Housing Choice Voucher.
Program #2: Project-Based Section 8 Housing
Project-Based Section 8 properties have an agreement with HUD (U.S. Department of Housing and Urban Development) that HUD will pay a portion of the contract rent (the rent rate that HUD has established for the property) for qualified residents.
The resident will pay 30% of his or her adjusted gross monthly income and HUD will pay the difference between the rent paid by the resident and the contract rent on the unit.
Project-Based Section 8 Housing is a little bit different than the Voucher Program. In this case, the subsidy is attached to the property, not the person. So, funding is given out based on the property, not an individual person and their income.
Who Qualifies for Project-Based Section 8 Housing?
It all depends on the property!
Eligibility factors always include an income limit based on a percentage of the median household income. This income limit is set by the Department of Housing and Urban Development (HUD). It’s updated annually and the income limit increases for every household member living in the unit.
Other eligibility criteria include age or disability if the property is considered an elderly property, as well as number of persons that will be living in the household.
Finally, for a household to qualify for a unit in this program, the household must require at least one dollar of subsidy even if it is below the income limit for the property/household size.
The best way to discover the eligible criteria for a property is to contact the Property Manager and ask what the eligibility criteria are for it.
What Are the Differences Between the Two Programs?
While both programs provide “deep subsidy” assistance, the major difference between the two is that in the Housing Choice Voucher program, the subsidy is attached to the tenant not the unit, while in Project-Based Section 8 programs, the subsidy is attached to the unit, not the tenant.
In other words, a tenant who has a housing choice voucher may move to another location and still receive Section 8 assistance, but with a Project-Based Section 8 property, if the tenant moves he or she may not transfer the subsidy to another property.
What Are the Similarities Between the Two Programs?
For both Housing Choice Vouchers and Project-Based Section 8 units, the tenant is required to provide income, asset and expense information on an annual basis. Rent will be adjusted yearly based on the information that is provided.
It is also important to note that despite differences in requirements for each program, the purpose of the two programs remains the same: to assist low-income families, persons with disabilities, and elderly by providing comfortable, safe housing.
In Conclusion…
There are two types of Section 8 Housing: Section 8 Voucher Program and Project-Based Section 8 Housing.
While both programs are meant to help low-income families, persons with disabilities, and the elderly, they do so in different ways. Section 8 Vouchers are attached to the tenant, while the subsidy for Project-Based Section 8 Housing is tied to the unit.
Section 8 can be a confusing topic, especially if you’re not dealing with the program on a daily basis. If you have any questions, please don’t hesitate to contact us! We’d be happy to help you manage your Section 8 property or help you find an affordable place to call home.
Hello, my name is Christopher Wagner and I am the President of Arbors Management. I would like to start out by stating that I am very proud of the team here at Arbors and I know that each and every member strives to do the right thing for our clients and make their experiences with Arbors as pleasant as possible. We are first and foremost a service business, and it is important for me to be able to serve our clients and customers excellently. Although I am not too comfortable talking about only myself, as I prefer to lead by allowing others to grow and reach their full potential, I understand that sometimes my role requires it. After owning several companies dealing in investment properties, developments, and investment loans, I joined Arbors Management in 2007, only expanding on my experiences of over 20 years in the real estate business. I enjoy my job immensely because I truly enjoy seeing growth in others, and in my position I am able to fully support the development of my team; whether this be mentally, emotionally, spiritually, or otherwise. I hold an IST Degree from Penn State, however make great efforts to lead a lifetime of continuous learning. When I am not at work, typically you can find me with my family. I have a fantastic wife, who is my true support in life, and four wonderful children. In addition, I have served in multiple churches in different roles, including as deacon, director of the media team, and various outreach teams. I enjoy giving back as much as possible and make decisions based upon my principles, including the decisions I make in business, how I conduct myself, and the standards to which I hold myself. I am very proud of the dedication and hard work of my entire team here at Arbors Management and I would like to introduce my leadership team to you.
Hello, my name is Trisha Jester and I am the Director of Multifamily Housing here at Arbors Management. I started in the property management business 32 years ago and since then have held various positions, including maintenance, assistant manager, site manager, and regional manager. I have been with Arbors Management for 24 years now. Having the opportunity to work in all aspects of the property management field and be a part of the process from start to finish has provided me with the breadth of knowledge that I need for my current position. I obtained my PA RE License in 1994, and have accumulated many hours of training in Fair Housing, Tax Credit Compliance, and Property Management. One of the things that I love most about my job at Arbors is that my team and I are able to help people who are truly in need of finding affordable housing. Together, the team and I manage over 2,450 units in Western PA and West Virginia. I have been married to my husband, Brad for 26 years, and have two sons, one in college and one a Sargent in the National Guard. On the weekends I enjoy road trips with my husband on our motorcycle, as well as gardening, reading, and cooking.
Hello, my name is Nicholas Griffith and I am the Director of Business Development here at Arbors Management, Inc. I also serve as the Vice President of Arbors Real Estate, LLC, our real estate sales company. I’ve been with Arbors since 2016, starting as a Portfolio Manager, then serving as the Director of our Scattered Site Properties, and now in my current role. Prior to Arbors Management I had experience in leasing and managing a growing portfolio of 300+ scattered site market rate rental properties. Additionally I also worked in the affordable housing industry as a Certified Occupancy Specialist working on qualifying new residents to move in and various certifications for their residency. During my time here at Arbors I’ve truly enjoyed working with our clients and customers to ensure their satisfaction with our services and my focus has been on perfecting and expanding our services to be the go-to resource for real estate investors. It’s been my pleasure to work with the dedicated and passionate team we have here at Arbors who really care about all the properties, owners, and residents we work with every day. When I’m not breathing all things real estate, you can likely find me at home with my wife, son, and dog. I enjoy the vast restaurant and local brewery options that Pittsburgh has to offer, watching football, hiking, canoeing, exercising, snowboarding, and traveling. I look forward to helping you achieve your real estate goals!
Hi, I am Patty Recklitis, and I am Chairman of the Board at Arbors Management. Being in the property management business for more than 30 years, I have watched this industry change and grow in so many fascinating ways. As a committed employee and now Chairman of the Board of Arbors Management, I have been instrumental in shaping this company and developing it into the strong, market leader position it enjoys today.
Buon Giorno! I am Cindy Peterle-Harris, the Director of Compliance here at Arbors Management. Although my degrees are in Political Science and the Italian language, I have been working in the affordable housing field since 1980, and with Arbors Management Inc. since 1995: first as a property manager for a senior complex, then as a regional manager, and as the Director of Compliance since 2010. Although it may seem that my education and my profession are worlds apart, I have used my language skills with residents who have limited English proficiency and used the lessons I learned in international diplomacy to maintain peace among neighbors and co-workers. As Director of Compliance, much of my time is spent in research, in teaching, and in problem resolution. I really enjoy working with the managers and staff of our affordable and conventional properties and helping to provide safe and comfortable housing for seniors and families. When not at the office, my husband and I are very involved with our Church and our combined families. With the recent birth of our 10th grandchild, “Grammy” has become my favorite title!
Hi, I am Michael Recklitis and I am the director of maintenance at Arbors Management and have worked for Arbors Management since 1995. I earned a Bachelor of Science Degree in Education and a Master of Science in Marketing Education from the University of Pittsburgh. My state certification in “Building Trades and Maintenance” allowed me to teach many students, who learned the basics of building repair and hand tool usage. I owned a small HUD subsidized apartment building. This ownership helped teach me about subsidized housing, REAC inspection and the required HUD tenant certification needed to rent those units. My position focuses on the physical condition of the many properties managed by the company. I enjoy working as a team member with building staff and have facilitated many property projects with outside contractors and our property staff. I have worked with PHFA Technical Services to complete needed work at other properties that they are involved in. My many interests have included but are not limited to gardening, amateur radio and going to that occasional Penguin, Steelers or Pirate game with my wife. As a boy, I earned the rank of Eagle Scout which helped teach me values and respect. As part of being a scout, I belonged to “The Order of the Arrow” that is Scouting’s National Honor Society which helped strengthen my faith.
My name is Eric Miles and I have been in the real estate industry since 1993. I obtained my Pennsylvania Real Estate Sales license in 1993, and after letting it expire, regained it in 2018 and have received my Brokers License in 2022. I have been intimately involved with mortgages/loans throughout his career with over $150 million of financing obtained for the multiple residential, commercial and office properties. I have worked with two other property management companies with one specializing in residential properties and the other in commercial and office before coming to work with Arbors Management Inc. in 2015 as their Controller. Since then, I have been promoted to Vice President of Operations which oversees the Accounting, Human Resources, Compliance and IT
departments as well as being elected to the Board of Directors.
I currently hold a BSBA in Accounting and a MBA in Finance from Robert Morris University as well as a BS in Real Estate from LaRoche College. In my free time, I enjoy reading and bowling and am often planning my next travel adventure.
Hello, my name is Alex Gurevich and I am the Director of Maintenance here at Arbors Management. I have over 15 years of maintenance experience working in high rise buildings and multi family complexes. I have been with Arbors since January 2019 and really enjoy working with our team. I have extensive background in electrical, HVAC and plumbing. I also enjoy working with electronics and automation, and have a huge passion for building mechanical systems and love troubleshooting problems.
Cayla has been involved in real estate since 2012. Over the last few years, she has obtained both a Realtors License and a Certified Residential Appraisers license. Additionally, Cayla holds a Bachelor’s degree where she specialized in Business and Management. Always looking to expand and grow, she decided to join the Arbors Real Estate team in 2023. Cayla is dedicated to providing excellent real estate services and looks forward to assisting you with your buying and selling needs!
Stacey has been with Arbors since 2020 as a property manager- responsible for 200 units. She recently obtained a Realtors License and is excited to help pair buyers and sellers with their perfect investment property, diamond in the ruff or first time home.
I began my journey in real estate in 2006 as a leasing consultant and obtained my real estate license in 2011. Prior to entering the real estate field, I pursued a degree in Hospitality Management, which eventually led me to become a General Manager at Atria’s in Robinson. What I love most about both industries is the opportunity to meet new people. I am married and have two sons, Antonio, aged 11, and Giovanni, aged 7. When I’m not working, I cherish spending quality time with my family, enjoying vacations, and indulging in delicious Italian cuisine!
Alexis has a drive to help others. She recently moved to Arbors Real Estate. LLC. As the Transaction Coordinator and Real Estate Agent. Whether you’re a first-time buyer or looking to sell your property, she changes her approach to meet your unique needs. With years of exceptional customer service, she focuses on building lasting relationships with her clients, ensuring they feel supported every step of the way.
