HUD Study Examines Cost Burdens among Housing Choice Voucher Recipients

A report prepared for HUD, Rent Burden in the Housing Choice Voucher Program, found that 46% of Housing Choice Voucher (HCV) holders in 2015 were cost-burdened, spending more than 30% of their income on housing costs, and 8% were severely cost-burdened, spending more than half of their income on housing. Cost burdens among HCV holders declined slightly from 2014, but were still significantly higher than in 2003.

The report examined cost burdens among HCV recipients for every year between 2003 and 2015.  The percentage of those with a cost burden fluctuated between a low of 32% in 2003 to a high of 48% in 2014, and the percentage with a severe cost burden fluctuated between a low of 5% in 2003 to a high of 10% in 2014. In 2015, 46% and 8% of HCV holders were cost-burdened and severely cost-burdened, indicating a small improvement from the previous year.

The poorest households, those earning less than 10% of their area median income (AMI), were 1.4 times more likely to be cost-burdened and 3.9 times more likely to be severely cost-burdened than those earning between 51% and 80% of AMI. Households living in single-family homes or with a larger number of bedrooms and households who were female-led, Hispanic, or non-white were more likely to be cost-burdened and severely cost-burdened. Those who were elderly or disabled were less likely to be cost-burdened or severely cost-burdened.

The study also tracked two groups of voucher holders over time to examine the duration of their cost burdens. The two groups were HCV holders who received their vouchers in 2003 and those who received their vouchers in 2008. The analysis indicates that changes in income have a significant impact on an HCV holder’s cost-burden trajectory. In every year, households who experienced an increase in cost burden had an average decline in incomes or small increase that did not keep up with rent increases. Households with an increase in cost burden who became or remained severely cost-burdened, however, had experienced an average income decline between 20% and 36%. The authors suggest housing assistance payment (HAP) annual certifications may not keep up with income changes. Households with a reduction in cost burdens had, on average, very large income increases.

The study also indicates the importance of affordable housing choices for HCV holders. HCV holders in metropolitan areas with a greater supply of neighborhoods with rents below the FMR were less likely than voucher holders in metropolitan areas with fewer affordable neighborhoods to be cost-burdened at initial lease-up, cost-burdened while using an HCV, cost-burdened for consecutive years, or cost-burdened when they exited the program.

Rent Burden in the Housing Choice Voucher Program is available at: http://bit.ly/2yfNgxw