Housing Security & the Evolution of Vouchers and Rental Assistance in the U.S.

Section 8. Vouchers. Tenant-based assistance. Private market vouchers. Housing help. Federal help with housing has been called many things. Often, these different terms refer to the same thing: housing choice vouchers.

For more than 50 years, housing vouchers have helped millions of people find affordable homes and stay stably housed. As a subsidy for households with incomes below the federal poverty threshold, vouchers, and the programs and policies behind them, have evolved with the changing needs and priorities of the time. What started as a 1970s experiment to understand the feasibility of a new approach to housing assistance in the U.S. has become the cornerstone of rental assistance, currently serving more than 2.3 million households nationally.

Pioneers of the research that helped establish the program reflect on the evidence that shaped it and how rental assistance might evolve to meet today’s housing affordability crisis. 

• Could rental subsidies be used in a private rental market? What effect would it have on the cost of housing? 
• What are the long-term impacts of moving from high-poverty to low-poverty neighborhoods?
• Do housing vouchers create the stability people need to improve their employment and income?

• What are the limitations of vouchers? One family’s experience.
• Could direct payments to households make a better form of rental assistance?
• How might landlords accept more vouchers for rental units? 
• How can housing mobility-related services be scaled up to support moves to low-poverty areas by families with children?

The Birth of Tenant-Based Rental Assistance and Housing Vouchers

Since 1974, the U.S. Department of Housing and Urban Development’s Housing Choice Voucher (HCV) program and its early iterations, has been the difference between housing and homelessness for millions of low-income households. Today HUD’s program is administered by more than 2,100 public housing agencies serving more than 2.3 million households (as of April 2024). 

Housing vouchers grew out of concerns about the adequacy of the social safety net that influenced the War on Poverty, followed by a demand for evidence on what worked best to alleviate poverty, says Abt Principal Associate Jill Khadduri, Ph.D. “This was a time of great policy ferment in the federal government.” 

Before the 1970s, the government’s approach to housing assistance largely focused on public housing developments, which over time created more concentrated poverty in urban areas. As urbanization and economic disparities grew, it was clear this model was insufficient to address the growing need for affordable housing and that the U.S. needed new policy innovations.

The EHAP experiments laid the foundation for what would become the future of housing vouchers. “The findings of the research had a very profound effect, showing that housing allowances or vouchers were actually doing what people were hoping they would do,” says Khadduri. 

HUD’s 1973 report on the findings of the EHAP concluded that: higher housing subsidies led to increased participation in the program; that housing choice was more dependent on social ties (where one’s family already lived) rather than financial incentives; vouchers did not damage the housing market by causing rent inflation; and administering them was in fact cost-effective and feasible. People could use subsidies on the private rental market. 

These findings forged a new era in federal housing policy through the landmark Housing and Community Development Act of 1974, which created Section 8 tenant-based housing assistance as an operating program, rather than an experiment.

Flexibility and Choice for Families: Finding an Apartment on the Private Market

For many people, ‘Section 8’ conjures images of housing projects: high-rises or apartment blocks. This idea refers to project-based housing assistance in which people live in designated buildings. But concerns about crime, social isolation, poor maintenance, and racial segregation inclined policymakers to shift to tenant-based rental assistance.

HUD hoped that Housing Choice Vouchers would provide more flexibility and choice for families and allow them to access better living conditions in the private market. Not everyone was certain this would work, points out Barbara Sard, housing policy consultant and former vice president for housing policy, Center on Budget and Policy Priorities. In the early years of the Housing Choice Voucher program, she was a lawyer with Greater Boston Legal Services in Massachusetts. 

"One of the things that became clear to me just by listening to our clients, she recalled, “was that the large majority preferred to get a housing voucher compared to admission to public housing or any of the privately owned properties with project-based rental assistance. For the most part, families with children especially preferred housing vouchers. And that made a very deep impression on me, that it was people's choice—because at the time, the prevalent attitude among lawyers in the legal aid world was that vouchers were not nearly as useful as project-based assistance programs.”

Families often reported liking vouchers, Sard explained, because it was easier to find housing and leave emergency shelter or living situations where they were doubled up with friends or family. “If you took the same family and they were applying at a property with a project-based rental subsidy that was managed by a large management company that put everybody through certain kinds of screening and had policies about who they would admit—versus in the voucher program, it was just much easier for the families I was working with to not only get the voucher, but to use the voucher and obtain an apartment.”

“I think the program has demonstrated its effectiveness in helping to prevent and ameliorate homelessness, much more effectively than any other approach,” Sard says.

By the 1980s and 1990s, housing vouchers were recognized as important keys to accessing affordable housing, even in tight rental markets. 

However, vouchers on the private market didn’t solve every challenge. Families with children could potentially use vouchers to move to higher opportunity neighborhoods with strong schools, transportation and jobs, but faced challenges in leasing up in these areas. With growing numbers of people experiencing homelessness, the demand for housing vouchers increased as communities recognized they could be a tool to achieve stable housing. Increased demand and limited funding for vouchers made waitlists and overall voucher scarcity a reality for public housing agencies across the U.S. 

HUD conducted several studies to help understand and address these challenges, including the Moving to Opportunity demonstration, which required some families with children moving out of public housing to use their vouchers in census tracts with poverty rates lower than 10 percent.

“It was the first random-assignment social science experiment designed to identify the causal effects of moving from high-poverty to lower-poverty neighborhoods,” HUD notes. HUD contracted Abt and the National Bureau of Economic Research to design and implement the experiment and to conduct the interim evaluation, which found that those who moved to areas with lower poverty reported better personal safety, mental and physical health, housing quality, and improved mental health and school attendance.

The 1999 Welfare to Work voucher program aimed to answer HUD’s question on whether housing vouchers would create the stability people need to improve their employment and income. The demonstration found they did not, highlighting instead the need for a holistic approach to lifting families out of poverty, a finding that reverberates today: It wasn’t enough to simply provide housing; job training, childcare, health care access, and transportation are also needed. But the study did show that having a voucher prevented homelessness. “This had a profound effect of how on how we think about one of the essential purposes of the voucher program, which was to prevent family homelessness,” says Khadduri.

In the 2000s, HUD aimed to understand not only the types of housing that would work best for people experiencing homelessness, but the long-term effects of housing on stability, family preservation, and wellbeing. HUD began the Family Options Study with Abt and randomly assigned families to separate intervention groups. Since 2010, the landmark study has followed nearly 2,300 families since they entered emergency shelter after experiencing homelessness. The families were randomly assigned to receive long-term rent subsidies (usually a voucher), another type of program, or to stay in shelter. 

This rigorous study changed the way U.S. policymakers at all levels of government address homelessness. After three years, the study found that providing families with priority access to vouchers not only prevents homelessness but also has radiating effects, including reductions in food insecurity, school moves for children, and intimate partner violence. 

Other pivotal research examined voucher payment rates. “A very big step was the change in flexibility on payment standards—to basing them on small area fair market rents rather than the metropolitan area,” said Sard. “A growing number of areas are adjusting the maximum voucher subsidy based on local rents, instead of a misleading average that tended to make it much easier for families to live in high-poverty neighborhoods.”

Abt’s work on the Small Area Fair Market Rent Demonstration showed how zip codes could be used to set voucher rent standards. This shift in approach allowed voucher holders to move to higher-rent, lower-poverty neighborhoods.

Throughout, Scarcity Remains Front and Center

Only 25% of people in need of a voucher actually receive one, and demand for the program is growing with inflation, higher rents, and a diminishing supply of affordable housing across the U.S.  The HCV program “should be at least doubled in size”, says Khadduri.

What’s more, only around 60% of households that receive vouchers are actually able to use them. Many have to return them to get back on the waiting list which can last years. Families often wait to get their turn only to end up back where they started. 

Without additional funding appropriations, the issue of scarcity remains. Recent analyses confirm this in practice. Writing in the journal Cityscape, Abt’s Nichole Fiore, Khadduri and Sam Dastrup describe the success that Los Angeles has had assisting people experiencing homelessness find stable housing. The scarcity of vouchers and their subsequent prioritization means limits on helping families with children move to higher opportunity areas with the vouchers they may receive. Federal expansion of HCVs would prevent having to choose one priority population over the other.

“I’m still barely making ends meet.”

MarKia Sims’ rental unit in Akron, Ohio is $1,300 a month. A 33-year-old single mother of two, she’s had a housing choice voucher since 2022. The voucher pays the difference between thirty percent of her income and the rent—so if she earns $2,000 per month, the rent she pays is $600, and the voucher pays the rest.

“We have a roof over our head. I feel like that's the most one of the most valuable, precious things that you could give your children while they are growing up is a home,” Sims says. “I didn't have stability. However, I'm still barely making ends meet.” 

She described feeling guilty taking her five-year-old son to a trampoline park where kids can jump and play. In Akron that costs $35. “I’m going let my kid be a kid, and that's healthy,” she said but recalled spending much of her energy that day calculating whether she had enough gas and food for the rest of the week. “Mentally, I'm exhausted because I am constantly thinking about the next thing that we need.”

Sims’ 14-year-old daughter was recently diagnosed with autism after years of intensifying emotional and behavioral challenges. She describes numerous hurdles including countless medical appointments, tests, and school visits to eventually get a diagnosis for her daughter so she qualifies for services as a child with disabilities. 

Supporting her has limited what employment Sims can pursue. A first-generation college graduate, she founded a business for transportation for single moms; a local group supporting minority-owned businesses awarded her a microgrant as a top entrepreneur for this work. Her daughter’s struggles put building her business on hold. Right now, she works different part-time jobs and helps run a community food pantry at her church. 

Would Direct Payments to Households Make a Better Form of Rental Assistance?

New studies seek to understand the longer-term impact on family and child well-being of direct rental assistance as an alternative to housing choice vouchers. They ask whether cash payments made directly to the household, rather than the property owner, provides families more autonomy in spending and savings, and whether it improves landlords’ acceptance of tenants using subsidies by reducing the bureaucratic burden of stringent inspections and paperwork.

“With vouchers, the household doesn’t get to keep the savings from negotiating a lower rent,” say Khadduri and Hannah Thomas, Ph.D., Abt principal associate. “Paying the housing subsidy directly to the family would arguably give the household more control over their budget, allowing tradeoffs between spending on housing versus other needs.” 

“Traditionally, we think of vouchers as solving a housing problem, and I'm starting to think of it more as solving an income problem,” says Peggy Bailey, executive vice president, Center on Budget and Policy Priorities. “We say housing ends homelessness, but that makes it sound like all we need is to build more housing, and that if we built enough housing, we wouldn't need rent subsidies. And that's not true, because we're not paying people enough to afford housing. The problem is also an income problem.”

The widening gap between incomes and the cost of housing affordability affects low-income families the most. The voucher program is not an entitlement program like Medicaid or Social Security. There are a limited number of funded vouchers and growing needs across cities and rural communities alike. In 2022, more than 22 million renters across the country (half of all renter households) are cost-burdened, paying more than 30 percent of their income to cover rent and utilities. And the number of renter households paying more than half of their income to cover rent and utilities reached an all-time high of 12.1 million in 2022.  

Frontiers for Housing Security and Family Wellbeing

On the anniversary of the HCV program, housing researchers, policymakers and advocates alike know that housing affordability is at a crisis level. And vouchers—both choice vouchers and project-based ones—are a key part in helping to address the need. 

But vouchers can’t solve everything. Instead, suggests Khadduri, making housing affordable means a coordinated approach that includes development of affordable housing units, more multi-unit medium-density housing, and revisiting earlier ideas like direct rental assistance. These solutions can’t come too soon. Working families around the U.S. share similar stories of struggling to pay their rent, water and power bills, and still have enough to eat. 

“I graduated from college. I started businesses,” Sims said, “But I still somehow seem to still be stuck. How do I really be free and be able to use my skill set to better me and my kids? [The Lord’s] still writing that story,” Sims says, “I don't know what He's holding next. He owns that key.”

Special thanks to Peggy Bailey, Meryl Finkel, Jill Khadduri, Barbara Sard, MarKia Sims, Michelle Wood and many researchers and reviewers for sharing their time, feedback and insights with us.