HUD Study Examines Costs Associated with First-Time Homelessness

A study released by HUD in March examines average costs per month for providing emergency shelter, transitional housing, and permanent supportive housing for first-time homeless families and individuals in six study communities across the nation. In past studies, research mostly focused on costs associated with homelessness for individuals with chronic patterns of homelessness or severe mental illness. 

For individuals experiencing homelessness for the first time, the overall costs are lowest for overnight emergency shelters. For families, however, emergency shelters are as or more expensive than transitional and permanent supportive housing. According to the study, these overall program costs for providing housing and services in an emergency shelter setting can vary widely, from $581 a month for an individual in Des Moines, IA, to as high as $3,530 for a family in Washington, DC. 

The report suggests that transitional housing for individuals is more expensive than permanent supportive housing because services for transitional housing were usually offered directly by on-site staff, rather than through mainstream service systems. The study defines mainstream service systems as those that are not solely dedicated to serving people who are homeless, yet provide services that are needed and often used by them, including Medicaid, mental healthcare and substance abuse treatment services, and income supports. 

The higher costs of emergency shelter for families stems from the fact that families are usually placed in private units or apartments. The study states that in almost all cases the program costs associated with providing housing for individuals and families exceeds the Fair Market Rent cost of providing rental assistance without supportive services. 

Of the households studied, 50% to 65% of the first-time homeless single adults and 58% to 72% of families stayed in a homeless program only once during the 18-month period in which the study was conducted. 

The report concludes that communities should explore cost-effective strategies to 1) prevent homelessness for the families facing first-time homelessness, including by using rapid rehousing interventions that address housing and income issues; 2) maximize mainstream systems already in place that service the needs of individuals and families struggling to stay housed; and 3) improve the way homeless assistance systems respond to individuals and families who are unable to remain stably housed and face repeated instances of homelessness. 

The report, Costs Associated with First-Time Homelessness for Families and Individuals, is available at: