The encyclopedia · Strategy & Leadership · Strategic decision · 1974
Section 8 gave the poor a rent voucher to shop the private market.
Instead of building public housing, the voucher pays the landlord most of a family's rent, letting the family rent anywhere a landlord will take it.
U.S. Department of Housing and Urban Development · public housing agencies · landlords
the move
Post-war public housing was expensive to build, concentrated poverty, and took years to deliver a single unit.
The 1974 Housing and Community Development Act established the tenant-based voucher: a family finds its own rental, the public housing agency pays the landlord most of the rent, and the family pays about 30% of its income.
Because assistance moves with the household, a family can choose where to live, and private landlords instead of the government become the housing supplier.
why it works
- Vouchers use existing private housing stock, so no new building is needed
- The subsidy follows the family, so it can relocate and de-concentrate poverty
- Landlords choose to participate, so the market screens units
- It is cheaper per household than building and maintaining public housing
what transfers
If the problem is that people cannot afford rent, pay the rent rather than building and owning housing — the private market supplies the unit and the money follows the family.
what came after
The Housing Choice Voucher program became the nation's largest rental assistance program, but studies also found it concentrated in disadvantaged neighborhoods where owners will accept vouchers, and it remains chronically underfunded relative to demand.
references
- Section 8 housing (Housing Choice Voucher)
- 24 CFR Part 982 — Section 8 Tenant-Based Assistance: Housing Choice Voucher Program
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