Freddie Mac Finds Cost Barriers May Prevent Housing Choice Voucher Usage

(Illustration courtesy of Freddie Mac Multifamily)

Although there are significant variations by market, Housing Choice Voucher use remains limited in high opportunity areas compared with areas of concentrated poverty, according to Freddie Mac Multifamily, McLean, Va.

Additionally, markets with high rents tend to have lower rates of voucher usage compared with markets with low rents, Freddie Mac Multifamily said in a new report, Housing Choice Vouchers and Access to Opportunity.

The report examined challenges to voucher usage, including the role of affordability and the efficacy of voucher usage based on geography.

Sara Hoffmann, senior director of multifamily research at Freddie Mac, noted the findings demonstrate that voucher usage is generally lower among areas that provide greater access to opportunity. “Our analysis found that high opportunity areas and higher rent areas have both lower voucher usage and a relatively low level of affordable units based on voucher limits,” she said.

The analysis indicates that even if voucher amounts increased, renting in expensive neighborhoods may still be cost prohibitive for voucher holders due to high market rents.

The study includes case studies from three metro areas, Providence, R.I., Santa Cruz, Calif. and Jackson, Miss., to examine scenarios under which different voucher levels could change the affordability profile of a metro area. It also outlines additional barriers to voucher usage in areas of high opportunity, including administrative, acceptance and process challenges.