Housing vouchers were created as an alternative to publically owned and subsidized affordable housing developments. Housing vouchers give low-income households a housing subsidy that they can use to make a privately owned apartment affordable, giving them mobility—the ability to move where they want. With a voucher, the tenant is responsible for paying rent that equals 30 percent of their income and the voucher pays for the difference between the cost of rent and 30 percent of the tenant’s income. Public and subsidized affordable housing were historically located in neighborhoods of concentrated poverty, and housing vouchers are a theoretical tool to help households leave neighborhoods of concentrated poverty. Housing vouchers are intended to support household mobility by giving households a choice in where they want to live and allowing them to pick private housing they deem to meet their needs as long as it meets the requirements of the voucher program. The goal of many housing voucher programs is to offer low-income households access to neighborhoods with greater opportunities, high-quality schools, jobs, healthcare and other services. The most common housing voucher program is the federal Housing Choice Voucher program (historically referred to as ‘Section 8’), though some state and local communities also run their own similar voucher programs.
How the Housing Choice Voucher Program Works
The Housing Choice Voucher (HCV) program is a federally funded program administered by local public housing authorities (PHAs), with oversight from the Department of Housing and Urban Development (HUD), that assists low-income households in affording privately owned rental housing. Typically, a household with an HCV pays 30 percent of its monthly income toward rent, and the PHA pays the landlord the difference between that amount and the full rent, up to a set limit. This limit is calculated using HUD standards for Fair Market Rent, which is assessed on a regional scale. The amount of the subsidy for each unit is referred to as the “payment standard” and usually varies by unit size. Roughly 2.2 million families in the United States have housing vouchers.
Barriers to Successful Housing Voucher Programs
The HCV program is the single largest federal housing subsidy program for low-income renters. Since the program’s inception in the 1970s, however, the goal of expanding housing choice has not been fully realized, as a disproportionate number of voucher holders continue to live in impoverished, majority-minority neighborhoods, with lower-performing schools than do other renters.
In theory, a housing voucher can be used at any property, provided that a landlord agrees to accept it. However, in nearly every state it is legal for a landlord to refuse to accept vouchers as payment. Generally voucher acceptance by landlords is popular in areas where rental demand is low. In high rental demand neighborhoods, landlords do not need voucher holders to fill units and have little interest in participating in screening and inspection requirements that come with voucher holders. Additionally, low-income voucher holders face more practical barriers to moving to low-poverty and high-opportunity neighborhoods, including limited public transit access, the loss of support networks and high rent deposit requirements, among others.
Many state and local governments have created their own housing voucher programs to try to resolve the overwhelming unmet demand for the HCV program. The wait lists for HCVs can be years long, and many PHAs have closed their wait lists. On a national level, only one in four eligible low-income households actually receives a voucher.
Mobility assistance programs help households that secure vouchers overcome obstacles to using housing vouchers in safer neighborhoods with higher-quality schools and therefore better access to jobs and services. Successful mobility programs often use a combination of direct assistance, legal strategies and administrative policies in order to provide a comprehensive set of services for voucher holders.
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Metropolitan Planning Council (Chicago)