A report from the Urban Institute released on September 22 examines the outcomes for households after they leave housing assistance. The study draws upon HUD’s Moving to Opportunity (MTO) demonstration project, which tracked a sample of nearly 5,000 public housing and voucher-assisted families in five cities over 15 years. The study also analyzed data from MTO’s Final Evaluation that looked at a subset of the MTO population between June 2008 through April 2010 reflecting housing mobility; adult education, employment, and earnings; household income and public assistance; adult, youth, and child mental and physical health; youth and child social well-being; and child and youth educational performance. In addition, qualitative interviews were conducted in 2011 with 24 housing assistance leavers from two MTO sites. Overall, the study finds that those who left housing assistance had mixed experiences.
Using information from the MTO Final Evaluation survey, and homeownership status and income data, the study found that 52% left housing assistance for positive reasons and 48% left for negative reasons. Households that left housing assistance because their income exceeded 50% of Area Median Income (AMI) or because they purchased a home were classified as positive leavers, while those that faced eviction or lease violations were classified as negative leavers.
The primary difference between positive and negative leavers was income. Households that left for positive reasons reported median income of $37,865, compared to $13,950 for negative leavers, a figure comparable to households still receiving housing assistance. Both positive and negative leavers experienced greater increases in income compared to families still receiving housing assistance. Specifically, the median incomes of positive leavers increased by $23,627 and that of negative leavers increased by $4,498, while the median incomes of assisted households increased by $1,441.
While 36% of positive leavers experienced severe housing cost burden (spending more than 50% of their income on housing costs), 52% of negative leavers experienced severe housing cost burden. Only 3% of positive leavers experienced homelessness, while 12% of negative leavers found themselves homeless. Positive leavers were also more likely to be satisfied with their new neighborhood and home, with 79% of positive leavers rating their neighborhoods as “safe,” and 64% of negative leavers feeling the same way. Despite the relatively encouraging outcomes among positive leavers, one in five positive leavers reported food insecurity and two-thirds reported medical or credit card debt in excess of $5,000.
Interviews with both positive and negative leavers found that many unassisted families described the stress of unpredictable incomes and unstable employment, and the resulting financial pressure after leaving housing assistance. Many families reported having little savings and were worried about the potential impact of health problems, divorce, or job loss. Interviews with families that became homeowners after leaving housing assistance suggested that many were struggling during the recession and faced serious financial pressure. Some had unmanageable interest-only loans or purchased homes that lost value after the housing crash.
The study recommends that HUD require housing authorities provide support for households at risk of eviction or lease violation. Furthermore, HUD should offer families leaving housing assistance for positive reasons services to smooth the transition, such as financial counseling or budgeting assistance. Lastly, the study questions the effectiveness of HUD’s efforts to promote homeownership to housing assistance recipients and recommends a long-term evaluation of Section 8 homeownership programs.
What Happens to Housing Assistance Leavers is at http://www.urban.org/UploadedPDF/413163-What-Happens-to-Housing-Assistance-Leavers.pdf