{
  "slug": "section-8-vs-market-rent",
  "title": "Section 8 vs Market Rent Calculator",
  "heading": "Section 8 vs Market Rent Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/section-8-vs-market-rent",
  "summary": "Compare net income from a Housing Choice Voucher tenant against a market-rate tenant.",
  "description": "Section 8 (Housing Choice Voucher) tenants often pay rent below the top of the local market, but they come with guaranteed payment from the housing authority for the subsidized portion, typically longer average tenancies, and in many jurisdictions a required annual HQS inspection. Market-rate tenants may pay more but carry more payment risk and, in a soft market, higher turnover and vacancy. This calculator nets out both paths using your own vacancy, turnover, and default assumptions so the comparison isn't just about the headline rent number, which is the mistake most landlords make when they dismiss vouchers outright or accept them without adjusting their assumptions.",
  "formula": "Net annual income = (rent × 12 × (1 − vacancy%)) − (turnover cost × turnovers/year) − (rent × 12 × default%).",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=section-8-vs-market-rent",
  "inputs": [
    {
      "id": "section8Rent",
      "label": "Section 8 monthly rent (contract rent)",
      "kind": "number",
      "hint": null,
      "default": 1550,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "marketRent",
      "label": "Market monthly rent",
      "kind": "number",
      "hint": null,
      "default": 1700,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "s8VacancyPct",
      "label": "Section 8 vacancy rate",
      "kind": "number",
      "hint": null,
      "default": 3,
      "unit": "%",
      "min": 0,
      "max": 50
    },
    {
      "id": "marketVacancyPct",
      "label": "Market tenant vacancy rate",
      "kind": "number",
      "hint": null,
      "default": 7,
      "unit": "%",
      "min": 0,
      "max": 50
    },
    {
      "id": "s8TurnoverYears",
      "label": "Avg years per Section 8 tenant",
      "kind": "number",
      "hint": null,
      "default": 4,
      "unit": null,
      "min": 0.5,
      "max": 15
    },
    {
      "id": "marketTurnoverYears",
      "label": "Avg years per market tenant",
      "kind": "number",
      "hint": null,
      "default": 2,
      "unit": null,
      "min": 0.5,
      "max": 15
    },
    {
      "id": "turnoverCost",
      "label": "Typical turnover cost",
      "kind": "number",
      "hint": null,
      "default": 2200,
      "unit": "$",
      "min": 0,
      "max": null
    }
  ],
  "outputs": [
    {
      "id": "diff",
      "label": "Section 8 net advantage over market",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "s8Net",
      "label": "Section 8 net annual income",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "mktNet",
      "label": "Market tenant net annual income",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "s8Gross",
      "label": "Section 8 gross collected",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "mktGross",
      "label": "Market gross collected",
      "format": "currency",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Section 8 monthly rent (contract rent): 1550 $",
      "Market monthly rent: 1700 $",
      "Section 8 vacancy rate: 3 %",
      "Market tenant vacancy rate: 7 %",
      "Avg years per Section 8 tenant: 4",
      "Avg years per market tenant: 2",
      "Typical turnover cost: 2200 $"
    ],
    "outputs": [
      "Section 8 net advantage over market: -$380",
      "Section 8 net annual income: $17,492",
      "Market tenant net annual income: $17,872",
      "Section 8 gross collected: $18,042",
      "Market gross collected: $18,972"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter section 8 monthly rent (contract rent) ($).",
      "Enter market monthly rent ($).",
      "Enter section 8 vacancy rate (%).",
      "Enter market tenant vacancy rate (%).",
      "Enter avg years per section 8 tenant.",
      "Enter avg years per market tenant.",
      "Enter typical turnover cost ($).",
      "Read your section 8 net advantage over market on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "section8Rent": 925,
        "marketRent": 1025,
        "s8VacancyPct": 1.7999999999999998,
        "marketVacancyPct": 4.2,
        "s8TurnoverYears": 2.4,
        "marketTurnoverYears": 1.2,
        "turnoverCost": 1300
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "section8Rent": 1550,
        "marketRent": 1700,
        "s8VacancyPct": 3,
        "marketVacancyPct": 7,
        "s8TurnoverYears": 4,
        "marketTurnoverYears": 2,
        "turnoverCost": 2200
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "section8Rent": 2475,
        "marketRent": 2725,
        "s8VacancyPct": 4.800000000000001,
        "marketVacancyPct": 11.200000000000001,
        "s8TurnoverYears": 6.4,
        "marketTurnoverYears": 3.2,
        "turnoverCost": 3500
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "Is Section 8 rent guaranteed?",
      "a": "The housing authority's portion is paid directly and reliably as long as the unit passes HQS inspection and stays in compliance, which is the main appeal. The tenant's portion (often 30% of their income) is still their responsibility and can go unpaid like any other rent, so it's not a 100% guarantee."
    },
    {
      "q": "Do voucher tenants really stay longer?",
      "a": "HUD data and many local housing authority studies consistently show longer average tenancies for voucher holders than market tenants, largely because moving means re-qualifying paperwork and finding another landlord willing to accept the voucher, which raises the switching cost for the tenant."
    },
    {
      "q": "What's the catch with Section 8?",
      "a": "Annual HQS inspections can flag items a market tenant would never mention (window screens, smoke detector count, peeling paint even in non-lead-risk areas), payment processing sometimes lags 30-45 days after initial approval, and contract rent is capped by the housing authority's payment standard, which may sit below true market in hot rental markets."
    },
    {
      "q": "Can a landlord refuse Section 8?",
      "a": "It depends on your state and city — a growing number of states and localities (including California, New York, and many major cities) prohibit source-of-income discrimination, making refusal to accept vouchers illegal. Check your local law before assuming you can decline vouchers as a matter of policy."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/vacancy-loss-calculator",
    "https://www.revenuelab.fyi/toolbox/rent-collection-loss-rate"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Section 8 vs Market Rent Calculator (https://www.revenuelab.fyi/toolbox/section-8-vs-market-rent)"
}