Federal housing expenditures are unbalanced in two respects, as our new chartbook shows: they target a disproportionate share of subsidies on higher-income households and they favor homeownership over renting. Low-income renters are far more likely than homeowners or higher-income renters to pay very high shares of their income for housing and to experience problems such as homelessness, housing instability, and overcrowding.
Federal rental assistance programs help these highly vulnerable families, but they are deeply underfunded and as a result reach fewer than one in four eligible households. Families with children and non-elderly households without children or a disabled member face particularly severe shortages (see chart).
Moreover, budget cuts due to sequestration have forced reductions in the number of families that rental assistance can serve, and those cuts could grow deeper in the coming years. Fortunately, the Murray-Ryan budget agreement that the House has passed and the Senate is expected to approve later today would make it possible to discontinue some of the sequester cuts planned in 2014 and 2015.
It’s critical that Congress use those resources to increase funding for housing programs targeted on the neediest families — especially for vouchers, the public housing operating fund, and homelessness assistance. If policymakers don’t provide additional funding, unmet needs among poor renters will grow substantially and the imbalance in federal housing policy will become even more severe.