To Better Meet Record Levels of Need, Keep Families Housed, Congress Must Increase 2025 Funding for Housing Assistance

The Housing Choice Voucher program is the country’s largest rental assistance program, helping households with low incomes afford a modest home of their choice in the private market.^[1]

As a new Congress works to finalize 2025 appropriations bills before the current stopgap funding measure expires on March 14, it should prioritize providing sufficient funding to prevent a cut in the number of families with vouchers. If Congress sticks with the essentially flat funding levels Republicans included in a bill passed by the House Appropriations Committee in July, CBPP estimates that almost 283,000 fewer households — or nearly 645,000 fewer people — would receive a housing voucher (see the tables below for state, local, and demographic breakdowns). In fact, many families could lose their homes because the funding shortfall would be so severe that some housing agencies would have no choice but to end families’ ongoing assistance. This cut, which would be the deepest in the history of the voucher program, fits in the new Administration and Congress’s strategy to reduce programs that support people with low and moderate incomes while simultaneously seeking to extend trillions of dollars in tax cuts that benefit wealthy households and corporations.^[2]

A final appropriations bill should provide at least enough funding to maintain the number of households that currently receive a housing voucher. Moving forward, Congress needs to expand rental assistance to help all people with low incomes who need it, including by providing long-term rental assistance funding that adjusts automatically to meet need.^[3]

Increased Funding Is Needed to Maintain Current Levels of Assistance

Housing vouchers are tied to rental costs, so they require annual, inflation-related funding increases to continue serving the same number of families. Because the federal government already underfunds the program, only about a quarter of the families who need housing vouchers receive them.

The House bill would effectively freeze 2025 funding at the 2024 level. In a letter sent to housing agencies in December 2024, HUD estimated that the proposed funding level for housing vouchers in the House bill is at least 11.4 percent, or more than $3.7 billion, short of what is needed to maintain current levels of assistance.^[4] This would be the most severe funding shortfall in the history of the voucher program.^[5] Some housing agencies that administer the program would be unable to absorb the cut without taking vouchers away from households that are currently using them to help pay the rent each month. (See Table 2 for a breakdown of the impact of the potential cuts at the largest housing agencies.) Already, the uncertainty about funding levels from Congress has prompted some housing agencies to cease issuing vouchers to new households, forcing families to remain on waitlists that are already typically years long.^[6] Others have pulled back vouchers that have been issued to families but have not yet been used to rent a home.^[7]

The Senate Appropriations Committee passed a bill with bipartisan support in July that, based on the data available at the time, appeared to provide a sufficient funding increase above the 2024 level to continue assisting the same number of families in 2025.^[8] However, the cost of helping families afford housing rose more rapidly than expected over the course of 2024, resulting in the Senate bill falling about 2.5 percent — almost $800 million — short of HUD’s current estimate of what is needed, which would lead to about 62,000 fewer households receiving assistance.

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HUD has based its updated estimate of funding needs on housing agencies’ actual 2024 cost and leasing data, adjusted by an inflation factor for 2025. While increases in rental costs have slowed from the surges of 2021 and 2022, rents are still rising and remain high compared to incomes.^[9] During 2024, the voucher program was still catching up to the rent increases over the past five years. As a result, over the course of 2024, program costs surpassed HUD’s 2025 budget request (issued in March 2024) and CBPP’s August estimates. Moreover, housing agencies typically hold funding reserves to cover unexpected needs, but many have exhausted these as rent and voucher costs have risen, leaving them with little cushion for a new shortfall.

Housing Vouchers Needed to Address Increasing Housing Instability

Affordable housing is a basic human need. Housing vouchers and other rental assistance help prevent people from experiencing homelessness, overcrowding, evictions, and other forms of housing instability, research shows.^[10] However, voucher funding is far short of the total amount needed, even before the cuts that would occur under the House and Senate bills. Only one in four households in need receives any form of federal rental assistance, and there are long waiting lists for assistance in nearly all parts of the country.^[11] Moreover, HUD recently released new data showing that the number of people experiencing homelessness was 18 percent higher in January 2024 than the same time in 2023, reaching an all-time high for the second year in a row.^[12] Funding for rental assistance and other financial resources from the federal government are critical so states and local communities can implement proven solutions to provide affordable housing and end homelessness.^[13]

Robust funding for rental assistance benefits all people with low incomes and their communities and can also help prevent deepening racial and other inequities that exist in housing insecurity^[14] and homelessness.^[15] Because of income and wealth inequities stemming from generations of discrimination in housing, education, and employment, people of color, particularly Black and Latine households, are more likely to receive or be eligible for rental assistance.

The impacts of systemic discrimination in employment and other inequities also result in women^[16] and people with disabilities^[17] disproportionately utilizing housing vouchers. Cuts to housing vouchers would result in disproportionate harm to these groups with an estimated 401,600 women and girls and 163,500 people with disabilities at risk of losing a voucher. The House bill would also put an estimated 248,700 children and 102,800 older adults at risk of losing assistance (see Table 3).

Further complicating matters, appropriations must be viewed in the context of the Administration’s attempts, through a January 27 OMB letter and other executive actions, to illegally freeze or withdraw funding previously approved by Congress. These actions have created unnecessary uncertainty about if and when funds will be made available in programs across the federal government. This uncertainty, alongside potential funding cuts, could be particularly disruptive in the voucher program, where tenants and landlords rely on consistent federal funding to help pay the rent each month.

A final appropriations bill should provide at least enough funding to maintain the number of households that receive a housing voucher. A final bill should also adequately fund other federal rental assistance programs, such as public housing, and Homeless Assistance Grants, which help people connect with emergency shelters and the services they need to obtain and maintain stable housing.

Moving forward, Congress needs to expand rental assistance to help all people with low incomes who need it, including by providing long-term rental assistance funding that adjusts automatically to meet need.^[18] In addition, the Administration must follow the law and Constitution and not block funding that is appropriated by Congress.