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Housing Choice Voucher Program (Section 8) – Eligibility & How It Works

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For people struggling to get by — or, tougher still, to support a family — on minimum wage, one of the biggest challenges is housing. Since 2009, the federal minimum wage has been set at $7.25 an hour, or roughly $1,256 per month. According to most financial experts, an affordable rent payment is one-third of your income. So, in theory, a minimum-wage worker should spend no more than $418 per month on rent.

However, in most parts of the country, it simply isn’t possible to find any type of housing for this little. According to the 2019 Out of Reach report by the National Low Income Housing Coalition, the average market price for a one-bedroom apartment in the U.S. is $970 per month. To afford this price, a worker would have to hold down more than two full-time jobs at minimum wage. A single parent on minimum wage would have to work more than two jobs while also raising kids and would also have to share a bedroom with them.

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The federal housing choice voucher program aims to help low-income families with this problem. It provides vouchers to help low-income families, the elderly, and the disabled cover their rent costs.

What Housing Choice Vouchers Are

Family Sitting On Livingroom Happy For Home Furniture

The housing choice voucher program, formerly known as Section 8, is the federal government’s biggest housing assistance program. Its goal is to make decent, safe, and sanitary housing in the private market available to those who can’t afford to pay market prices. The voucher program provides assistance to individuals and families to help cover the rent on any type of dwelling they choose, including single-family homes, townhouses, and apartments.

The History of Housing Choice Vouchers

Public housing in the U.S. dates back to the Great Depression. Federal agencies funded the construction of apartment complexes, often called “projects,” to house low-income people and families. Eventually, state and local housing authorities took over the operation of the projects, while a series of federal departments assumed responsibility for funding them.

For a few decades, housing projects were well-made buildings that housed people from a range of income levels. However, over time, both federal funding and building standards declined. The general public came to view the projects as shoddy, unattractive, poorly maintained homes that were plagued by crime and fit only for the poorest of the poor. This negative stereotype wasn’t always true, but it increased public opposition to new housing projects.

In the 1960s, the government tried a new approach. It passed the Housing and Urban Development Act of 1965, which put public housing under the control of the U.S. Department of Housing and Urban Development (HUD). Section 23 of this act gave local housing authorities the ability to house people in privately owned buildings by giving them vouchers that covered the difference between the market rent and what they could afford to pay.

The use of housing vouchers expanded greatly in the 1970s. The Housing and Community Development Act of 1974 created the Section 8 Housing Choice Voucher program, which aids poor tenants by giving subsidies to their landlords. By the 1980s, vouchers had become the main form of government-assisted housing.

How Housing Choice Vouchers Work

The housing choice voucher program is a partnership between HUD and local public housing agencies (PHAs). HUD provides funds to the PHAs, and they issue vouchers to help low-income families cover their housing costs. However, instead of giving these vouchers to the families, the PHA pays the money directly to their landlords.

Some vouchers are project-based, meaning they cover all units within a given building for a given time. Any families living within that building pay only 30% of their gross income for rent, with the voucher covering any difference between that and the market cost. If a family moves out of the building, it loses its voucher coverage. The PHA refers a new family from its waiting list to the owner, and that family receives the subsidy when it moves in.

By contrast, the majority of vouchers are tenant-based. They apply to a given person or family, who can use them to cover rent costs on any property that accepts housing choice vouchers. The requirements for landlords to become a voucher program landlord vary by area. Among other things, the rental unit  — which can be a single-family home, townhouse, or apartment — must meet the PHA’s minimum standards for health and safety.

Once a family finds a home, the PHA checks it to make sure the home meets all requirements, including a reasonable rent cost. If it does, the PHA enters into a contract with the landlord that gives it the authority to make subsidy payments on the family’s behalf. The PHA pays the landlord the difference between 30% of the family’s income and either the total rent cost or a standard cost determined by the PHA, whichever is lower. The family is then responsible for the rest of the rent.

If the family moves out of the home, the PHA’s contract with the owner ends. The family is free to move to a new home and receive the same assistance there, as long as it meets all the program’s requirements.

Who Qualifies for Housing Choice Vouchers

Each local PHA sets its own rules about who is eligible for housing choice vouchers. However, in general, all applicants must meet certain basic requirements:

  • Citizenship. Housing choice vouchers are available only to U.S. citizens and specific categories of legal immigrants. The PHA can ask applicants to provide proof of citizenship or legal immigration status for themselves and every member of their household. Mixed families, in which some members are legal residents and others are not, can get limited assistance based on the number of eligible members.
  • Income Level. Typically, to qualify for a voucher, you must have a family income no higher than 50% of the median income in your area for a family of similar size. In fact, by law, a PHA must give 75% of its total funds to applicants whose family income is no higher than 30% of the median. However, some applicants making up to 80% of the median income can qualify for aid. These include families who have lost their homes due to the demolition of an existing housing project and those who have opted out of project-based vouchers. HUD determines the median income levels and income limits for different parts of the country.
  • Criminal History. PHAs also check out the criminal history of all voucher program applicants. In general, each PHA sets its own rules about which crimes make you ineligible for aid and how recent those crimes can be. However, HUD bars all registered sex offenders and people who have been convicted of making methamphetamine in public housing from receiving housing choice vouchers. It also requires PHAs to deny aid if any family member is currently an illegal drug user or is abusing any other substance in a way that could threaten the health and safety of other residents.

Advantages of Housing Choice Vouchers

More Money Cash In Pocket

For low-income people in need of affordable homes, housing choice vouchers offer many benefits. They include:

  1. More Available Income. Because it’s so hard to find an affordable apartment in many areas, low-income families often have to spend the majority of their income on rent. With a housing choice voucher, they can cut their rent cost down to 30% of their income, leaving more money available for other essentials like food, clothing, and medication.
  2. Freedom of Choice. Vouchers give people a much wider selection of possible homes to choose from than traditional public housing. Instead of having to live in a housing project that may be far away from work, school, or family, they can find a home in a convenient location. This helps them cut the length of their daily commute, freeing up time as well as money.
  3. Better Quality of Life. Traditional housing projects are often located in poor neighborhoods with high crime rates. This gives them a bad reputation, which makes it harder to get approval for new projects in safer, more desirable neighborhoods. Housing choice vouchers can allow low-income renters to find homes in safer neighborhoods with lower crime rates, better schools, and increased job opportunities. However, as noted below, it’s often hard to find landlords in these areas who are willing to accept the vouchers.
  4. Benefits for Society. Freeing up money in low-income families’ budgets makes it easier for these families to climb out of poverty, reducing the overall U.S. poverty rate and the cost of social programs that help the poor. It also spreads low-income renters across a wider area instead of concentrating them in high-poverty areas, which tend to suffer from higher rates of crime and drug abuse. This reduces the number of children exposed to crime, drugs, and violence, reducing the chances they will have the same problems as the adults in their lives.

Disadvantages of Housing Choice Vouchers

Wooden Model Clock Long Wait Concept Time Is Ticking

Although housing choice vouchers have many advantages over old-school public housing, they also come with some major headaches for renters. These include:

  1. Long Wait Times. In most areas, local PHAs don’t have enough funding to cover all applicants for the voucher program. As a result, applicants usually have to wait a long time to receive their first housing choice voucher. In some areas, PHAs stop accepting new applicants completely because they already have more families on their waiting list than they can help. According to Marketplace, in 2018, the average wait time nationwide was more than two years, and about half of all PHAs had closed their waiting lists.
  2. Limited Availability. Although vouchers give tenants more choice than other public housing options, many tenants still have difficulty finding a home. Under the program’s rules, people who finally make it to the top of the waiting list have just six months to find a landlord who will accept their voucher. If they can’t, they lose the money completely. In Los Angeles, Marketplace reports, 40% of recipients lose their vouchers because they can’t meet this deadline. And according to The New Republic, most landlords who accept vouchers are in less desirable neighborhoods — the very places vouchers were designed to help tenants escape from.
  3. Extra Work. Getting and using a housing choice voucher takes a lot of work. Would-be recipients have to go through a long application process, wait months or years for a voucher, and then search for a landlord who will accept it. Once they do, they need to reach a deal with the landlord and have the property inspected to make sure it meets PHA requirements. After moving in, they must keep the PHA updated on any changes in their family composition or income that could affect their subsidy. If they move, they must notify the PHA ahead of time and find a new home that fits all PHA requirements.
  4. Stigma. Tenants using housing choice vouchers face less social stigma than those living in public housing projects. Since they’re in privately owned housing, most of their neighbors probably can’t even tell they’re using vouchers to pay for it. However, according to Truthout, they can still face discrimination from landlords, who often assume low-income people make poor tenants. Many landlords refuse to accept vouchers, while others charge higher rents to people using them — a practice that’s perfectly legal in many areas. And some renters also feel judged by their family, friends, or neighbors for accepting “government handouts,” which can add stress to their lives.

How to Apply for a Housing Choice Voucher

Laptop Application Form Online

To receive assistance under the housing choice voucher program, you must apply through your local PHA. There’s a full list of all the PHAs in the country and their contact information on the HUD site. Contact your local PHA to find out whether it’s currently accepting applications and how to submit one.

When you apply, the PHA requests information about your family size, personal history, income, and assets. Some PHAs accept this information by mail or online. Others require a personal interview, either in your home or at the PHA office. The PHA is likely to ask for documents to prove your identity, citizenship status, and income.

The PHA checks your information with other local agencies, your employer, and your bank to decide whether you qualify for aid and, if so, how much. If you qualify, you earn a spot on the PHA’s waiting list. When your name reaches the top of the list, it contacts you and issues you a voucher. You then have six months to find a rental unit where you can use your voucher, get the property inspected, sign your lease, and move in.

As noted above, you’ll probably have to wait a long time after applying before you actually receive a housing choice voucher. However, depending on your circumstances, you may be able to shorten your wait time.

Local PHAs are allowed to give higher priority to certain types of applicants, based on the needs of their particular community. For instance, people who are currently homeless, are living in substandard housing, have been forced out of their homes, or are paying over 50% of their income in rent can often earn a higher position on the waiting list. Make sure to give your local PHA as much information as possible about your situation so you can take advantage of any local preferences that apply to you.


Final Word

The housing choice voucher program helps both landlords and tenants. It gives tenants access to better homes in safer neighborhoods than they could afford on their own, and it gives landlords a wider choice of tenants and a reliable source of income.

But despite these benefits, the program isn’t universally popular. Like all social programs, it costs money — even though it has faced steep cuts since the early 2000s — and PHAs don’t always use the funds effectively. Mismanagement at the local level has contributed to problems like long wait times, lost applications, lack of support for tenants, and late payments to landlords. Because of these problems, some critics argue the tax dollars spent on it would do more good in other areas, such as health care or education.

However, as the Federal Reserve observed in a 2015 working paper, research shows that moving families out of poor neighborhoods is the single most effective strategy for raising them out of poverty. Given that so many of the program’s problems stem from a shortage of funds, increasing its funding would probably do more to help fight poverty in America than cutting it and spending the money elsewhere. Requiring more landlords to accept vouchers would also help open up more housing choices for low-income renters and break up concentrated pockets of poverty in America’s cities.

Do you think the housing choice voucher program accomplishes its goals? If not, what changes do you think would be most useful to reach these goals?

Amy Livingston
Amy Livingston is a freelance writer who can actually answer yes to the question, "And from that you make a living?" She has written about personal finance and shopping strategies for a variety of publications, including ConsumerSearch.com, ShopSmart.com, and the Dollar Stretcher newsletter. She also maintains a personal blog, Ecofrugal Living, on ways to save money and live green at the same time.

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