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Housing Vouchers Work: Strengthening Families and Communities

This is the next post in our “Housing Vouchers Work” blog series, which provides the latest facts and figures about the Housing Choice Voucher program, the largest rental assistance program to help families with children, working people, seniors, and people with disabilities afford decent, stable housing.

Housing vouchers strengthen families — and strong families make strong communities. Vouchers support work, for example, by enabling families to live in stable homes and freeing up income to pay for transportation and other work-related costs. By protecting children from homelessness and other risks, vouchers improve their chances of growing up to be healthy, productive adults.

But housing vouchers strengthen communities in other ways, too. Children (in both low- and high-income families) earn significantly more as adults if they grow up in communities that are less segregated by income and race, have less income inequality and violent crime, and have better schools and more two-parent households, according to recent groundbreaking research led by Stanford economist Raj Chetty. While segregation is a problem that must be attacked from many angles, housing vouchers can help more low-income children grow up in diverse communities with good schools and less violent crime.

Vouchers’ portability enables families to move to neighborhoods with better opportunities. African American and Hispanic families that use housing vouchers are twice as likely to live in low-poverty neighborhoods, for example, than other poor minority households. Research shows that children whose families use housing vouchers to move to low-poverty neighborhoods when they’re young are far likelier to attend college and less likely to become single parents, and they earn significantly more as adults (see chart). (Voucher program reforms could enable more children to grow up in low-poverty, high-opportunity neighborhoods.)

In addition, vouchers can help low-income families in once-poor neighborhoods that are experiencing economic revitalization. Revitalization can bring benefits — such as economic growth and more jobs, as well as better schools and other community resources — but it often also brings rising rents that make it hard for low-income families to remain in place. By “project-basing” vouchers in revitalizing neighborhoods, housing agencies can help low-income families to share revitalization’s benefits.

When local economies are weak, housing vouchers can provide a modest economic boost, too. One of the most effective ways to increase demand for goods and services, as the Congressional Budget Office has explained, is to expand financial aid for low-income households — such as housing vouchers, unemployment insurance, or food aid — because such aid causes a rapid increase in household spending. Boosting demand creates and preserves jobs and stimulates economic growth, as retailers respond to more spending by retaining employees and hiring more, as well as maintaining or increasing their orders from suppliers — who are themselves then likelier to retain or hire employees. The rise in spending thus multiplies throughout the economy.

Housing vouchers can also help to stabilize neighborhoods in weak housing markets. Vouchers provide reliable rental income streams that enable property owners to pay taxes and maintain their properties in good condition. (Properties where vouchers are used must meet federal quality standards.) Vouchers can thus help prevent building deterioration and neighborhood blight, which are linked to problems such as increased crime and falling property values.

In short, vouchers make for more stable neighbors and neighborhoods.