Effects of Welfare to Work Housing Vouchers

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In 1999, Congress approved a Welfare to Work Voucher demonstration program that made 50,000 housing vouchers available to eligible families. After submitting an assessment of the project to Congress in 2004, HUD continued to follow voucher families to evaluate the program’s long-term effects.

An important feature of the program was the freedom it gave families to choose their housing. Voucher holders were responsible for locating a suitable neighborhood, a willing landlord, and a housing unit that would meet inspection standards. Alternatively, they could apply the voucher to their current residence. Vouchers provided housing affordability with relatively few restrictions, making it possible to learn voucher users’ preferences and priorities.

HUD’s findings, documented in the report Effects of Housing Vouchers on Welfare Families, indicate that vouchers have been effective in reducing homelessness and improving living conditions. On the other hand, vouchers appear to have had little effect on employment, earnings, education attained, and other aspects of family well-being.

Vouchers enable users to make small improvements in their home neighborhoods.

Where Did Families Choose to Live and With Whom?

Voucher users were able to make small improvements in their home neighborhoods. Families who used vouchers to move reported feeling safer in their new surroundings, although they remained dissatisfied with the overall safety and quality of their neighborhoods. This feedback suggests that voucher programs might be more effective if they provided low-income families with mobility counseling, housing search guidance, and assistance with security deposits, which would allow them to compete for housing in better neighborhoods.

Families receiving vouchers moved less frequently than nonrecipients. They reported that the voucher stabilized their housing situation and eased the pressure and anxiety that accompany having to move. Many recipients were able to become more independent by establishing smaller households; for example, a voucher could allow a single parent to leave an overcrowded, multigenerational living arrangement.

Did Vouchers Reduce Material Hardship?

Researchers found that voucher assistance does reduce homelessness and overcrowding. Recipients said that vouchers made them less anxious about homelessness and being forced to move in with others. Families expressed a strong preference for independent households and increased living space.

Recipients reported that vouchers helped stabilize their housing situation.

Vouchers also eased the stress on household budgets, providing some relief from financial hardship and freeing up funds for other necessities. Interviewees remarked on the importance of having money for groceries, school supplies, and clothing, as well as discretionary spending for children who want to blend in with their peers. Vouchers also eased the financial impact for families reaching the end of their eligibility for Temporary Assistance for Needy Families.

How Were Children Affected by Vouchers?

Although vouchers had a positive influence on the environment in which children developed, the program’s effects on children’s well-being were minimal. Researchers supposed that supplying children with an improved neighborhood and increased parental attention and discretionary income would produce tangible benefits; however, the precarious circumstances of voucher families remained substantial enough to outweigh small improvements in their quality of life.

Did Vouchers Affect Self-Sufficiency?

Contrary to initial expectations, housing vouchers did not significantly affect total earnings, nor did they adversely affect the self-sufficiency of low-income families. The ability to live closer to job opportunities and in neighborhoods that might be supportive of employment was not a determining factor in decisions to move.

Families with housing vouchers actually received more public assistance benefits than they did before entering the voucher program. Researchers suggest that as voucher-receiving households became smaller, they lost the financial advantages of a larger household’s pooled resources. This loss encouraged the remaining members to secure all the public assistance benefits for which they qualified.

The full report, Effects of Housing Vouchers on Welfare Families, and an earlier report, Evaluation of the Welfare to Work Voucher Program, are available as free downloads at www.huduser.org/publications/commdevl/hsgvouchers.html and www.huduser.org/publications/pubasst/welfrwrk.html, respectively. Print copies of both reports can be ordered from HUD USER for a nominal fee by calling 800.245.2691 and selecting option 1.