The Use of Housing Choice Vouchers in New York City

Blog post by Furman Center for Real Estate and Urban Policy

Furman Center for Real Estate and Urban Policy   (New York)

For more than 5 million people across the country, Section 8 Housing Choice Vouchers are a lifeline providing a source of rental assistance every month. Vouchers subsidize housing costs of families with very low to extremely low incomes, covering the difference between their full rent and about 30 percent of their household income. 1 The Housing Choice Voucher (HCV) program encompasses both vouchers attached to specific buildings (“project-based vouchers,” which can also help subsidize the development or rehabilitation of a property) and tenant-based vouchers, which tenants use to rent a home of their choosing, including their current unit (subject to restrictions outlined below). In total, close to 123,000 households use Housing Choice Vouchers in New York City, nearly 99,000 of whom use tenant-based vouchers. In this chapter, we look at the tenant-based voucher program and its use in New York City. 2

Both nationally and in New York, advocates and policymakers have increasingly turned their focus to expanding tenant-based subsidies as a way to improve housing affordability for low-income households. While the HCV program is the nation’s largest rental assistance program for low-income households, unlike other aspects of the social safety net, vouchers are not an entitlement and demand far outpaces their availability. Nationally, most income-eligible households never receive a voucher and applicants who do typically spend several years on waitlists before receipt. Yet research demonstrates that vouchers are a cost-effective policy, 3 that reduce rent burdens and improve a number of other housing outcomes for families, such as reducing crowding and decreasing the likelihood of homelessness. That said, HCVs have been found to face two challenges. The first is in expanding neighborhood choice, particularly to include higher-resourced neighborhoods, such as those with lower poverty rates and better schools. 4 The second is in the ability of voucher recipients to successfully use their voucher in any neighborhood. Across the country, only about two-thirds of households that received a voucher in 2019 were able to successfully lease a home, 5 due at least in part to the combined challenges of tight rental markets, source of income discrimination, and finding a unit that meets program quality specifications. When a household is ultimately unable to use a voucher, it is provided to another household.

In this chapter, we draw on detailed, household-level data from the Department of Housing and Urban Development (HUD) to take a closer look at the experience of households with tenant-based HCVs in New York City, both recently and over the last decade. We begin with examining which households are able to access the critically important HCV program, and how they compare to all of the city’s renters and renters who are poor. We look at rent burdens and the amount of rent paid by a typical voucher holder to understand the role vouchers play in making housing affordable in New York City. We calculate the median length of time a participating household stays in the voucher program, noting that households are using their vouchers for longer periods than a decade ago. We also consider one measure of housing stability, examining eviction filing rates and executed warrants among voucher households. We find that, post-pandemic, eviction filing rates are lower for voucher households than for other renters in the same neighborhood.

We explore the quality and size of buildings in which voucher holders reside, as well as how supply-side housing policies such as project-level subsidies, tax exemptions, and rent regulation may work in tandem with vouchers to open up more and newer buildings for voucher holders. We take a close look at the neighborhoods where households with HCVs live, and find that, similar to national patterns, voucher holders in New York City do not typically live in higher resourced areas, as measured by factors like school performance and neighborhood poverty. Rather, they live in neighborhoods that look very similar to those of poor renters generally. We also find that the share of new voucher recipients successfully using the program to lease a home in New York City declined to just over 50 percent in 2022. Our findings speak to concerns about source of income and other forms of discrimination against tenants, as well as the simple challenge of finding a home renting within program parameters in the midst of an expensive and competitive housing market, with a vacancy rate of 1.4 percent. 6  

While New York City’s HCV programs are not immune to broader programmatic challenges, the housing policy community is engaging with tested reforms that show promise in overcoming these issues. For example, New York City recently started incorporating more localized rent caps in high-resource areas to unlock those neighborhoods. 7 Enforcement of the prohibition of housing discrimination based on source of income, and efforts to ease the unit inspections and the income certification processes are just a few other examples of approaches that target some of the concerning trends elevated by our analysis.