Rethinking Federal Low-Income Housing Policies

Federal housing programs are sustained more by inertia and the difficulty of unwinding financial obligations than by a consensus that these policies are effective in helping people. Established rationales have been weakened both by changes in the nature of the housing problems faced by low-income households and by the inability of research to demonstrate that these programs are as cost-effective as alternative means of helping improve the lives of the poor. Setting a new course requires us to rethink housing policy—from its premises on up. Such fundamental reexamination may eventually produce a new level of agreement on what this spending is intended to accomplish and that, in turn, could support and steer efforts to alter the way federal housing policies are designed and administered, to increase their effectiveness.

A forward-looking housing policy reform agenda should focus on ways to target housing assistance on specific social objectives. Housing assistance can be combined with other tools where there is reason to believe that the deployment of resources is likely to produce benefits commensurate with its cost, such as with efforts to end chronic homelessness, linking community-based employment support and rent incentives, supporting asset building for working families, and helping avoid unnecessary institutionalization. The current administrative system must also be reengineered. To do so will require that the administration of housing subsidies is integrated with administration of other social services, decisions about low-income housing development is separated from decisions about households, and current systems for control and reporting are replaced with streamlined accountability systems that focus on results, both locally and nationally.

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