HUD On Boosting Landlord Voucher Acceptance In Housing Choice Voucher Program
The success of the Housing Choice Voucher program depends on the landlord’s participation but unfortunately, the landlord’s participation is declining. HUD is taking several measures to boost landlord participation.
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Serving around 2.3 Million households annually, Housing Choice Vouchers remain the largest rental assistance program in the United States. As more and more residents are using the housing choice vouchers to lease privately owned units, it is the landlord’s participation that determines the program’s success. There are only a few landlords who are accepting the vouchers which in turn is leading to declining voucher utilization rates. Consequently, increasing the landlord’s participation in the Housing Choice Voucher program is the top priority for HUD.
The Bipartisan Policy Center hosted a webinar on boosting landlord voucher acceptance on April 14, 2023. The webinar highlighted the challenges in landlord voucher acceptance along with the current and proposed initiatives to increase landlord participation in the program. Solomon Greene, Principal deputy secretary at HUD, Todd Richardson, Deputy assistant secretary at PD&R, and Nicholas Bilka, director of the HCV program were the presenters of the webinar.
Barriers to landlord participation
More than 5000 landlords have left the HCV program every year because of the rising number of voucher holders. According to the study conducted, more than 70% of landlords refuse to rent to voucher holders. The reason behind the low participation of landlords is the burdensome program requirements imposed on landlords by HUD and Public Housing Agencies (PHAs). One common concern of most of the landlords about participating in the Housing Choice Voucher was the compulsory inspection process. The landlords want the PHAs to take their side in times of conflict with the tenants.
Another reason landlords are not participating in the HCV program is the inadequate rent. It is because the landlords are required to decide the rent according to the fair market rent (FMR). It is the high rents and low vacancy rates which discourage the landlords from participating in the HCV program.
Encouraging landlords participation
Nicholas Balka threw light on HUD’s actions since 2021 to increase the landlord’s participation in the HCV program. HUD is channelizing its efforts to streamline the inspection process and make it more consistent and objective. HUD allows PHAs to conduct remote video inspections so that there is no need to go onsite which in turn will also save money and time for both PHAs and landlords.
HUD also introduced Small Area Fair Market Rents (SAFMR) in 2016 to be collected at the zip code level. It enables the PHAs to provide higher subsidies for rentals in communities where average rents are higher than the market’s average rent. Consequently, the participation of landlords increased and it resulted in more leasing opportunities in higher-cost neighborhoods. In addition to this, HUD increased the payment standard from 110 to 120% of the FMR. The PHAs were also allowed to use administrative fees for utility deposits, security deposits, and landlord incentives due to the 2022 appropriations act.
Several proposals are highlighted by Bilka in HUD’s 2024 Budget. HUD is planning to launch a demonstration program which in turn allows the housing assistance payment funds to be used for security deposits. Bilka also proposed that policymakers amend the code and allow the flexible use of administrative fees. Another proposal is to allow PHAs to inspect the units before the current residents are ready to move. Bilka also suggested the use of certain technologies to make renting units easier for landlords. Greene said, “source of income protection doesn’t necessarily result in better outcomes for voucher holders if it’s not accompanied by other things, such as program improvements”.
Richardson believes that the stability of tenants for vouchers can benefit landlords in terms of reduced turnover costs. HUD continues to monitor the effectiveness of strategies to strengthen the program.
Last Updated: September 20, 2021