President Joe Biden’s newly announced plan to address the housing affordability crisis has given homeless advocates a reason to celebrate. Slowing the nationwide increase in rent and increasing the supply of affordable housing will help low-income families stay in their homes, make housing more accessible for those currently experiencing homelessness — and provide substantial savings to taxpayers.
Biden’s goal is to tackle inflation and increasing housing stock is the perfect place to start. Across the country, there is an estimated housing supply deficit of 3.8 million homes, which has severe economic consequences, including driving inflation and exacerbating the homelessness crisis. Homelessness creates massive social and economic costs for American cities, families, individuals, and the federal government itself; one 2017 study found that a person experiencing chronic homelessness costs the taxpayer an average of more than $35,000 per year.
Whatever political willpower exists to relieve economic price pressures caused by inflation should be used to secure investments in affordable housing. Guaranteeing quality, safe, and affordable housing while preventing and reducing homelessness is not only the right thing to do; it will save Americans money by preventing vulnerable individuals from losing their homes in the first place.
Houston demonstrates the benefit of this approach. The city has decreased homelessness by approximately 63% since 2011 and saved taxpayers millions of dollars by placing people in permanent housing and giving them the support they need to stay there. The cost of allowing people to remain on the street — costs associated with community programs, health care, child welfare, public health, mental health care, and criminal justice — is enormous.
Conversely, through permanent housing programs and supportive services, Houston houses individuals for approximately $18,000 per person per year — the average cost of rent for a one-bedroom unit plus a portion of a case manager’s salary. This cost-efficient approach was expanded with phase one of the $65 million Community Covid Housing Program (CCHP), when the city of Houston and Harris County invested federal COVID relief funds to permanently house people experiencing homelessness. The program housed — or provided homelessness diversion services to — more than 7,000 people between October 2020 and January 2022. Phase two was announced in January 2022 with the goal to serve an additional 7,000 people experiencing homelessness by December 2024.
According to an annual national survey, similar programs nationwide funded by the American Rescue Plan and House America initiative were also effective in reducing homelessness. However, the success of these programs is dependent on a city’s housing stock. Houston currently faces high occupancy rates — 93 percent occupancy for class C properties — which limits the number of apartments available for both the general public and for those trying to avoid or exit homelessness. Long term, fixing this issue requires building affordable housing and dedicating a portion of those units to a community’s homeless response system. Houston’s goal is to secure anywhere from 20 to 30 percent of an affordable housing project’s units for those exiting homelessness.
Based on Houston’s success, we know that permanent housing with supportive services is the solution, but only if we have the housing stock to support the approach. President Biden’s action to reduce housing costs by investing in the development and/or rehabilitation of affordable housing will enable more cities to continue moving unhoused individuals directly into permanent housing. Guaranteed housing provides our most vulnerable neighbors the opportunity to live fulfilling lives and achieve self-sufficiency, not to mention cost savings that will reduce the impact of inflation for middle- and low- income Americans.
Houston’s federally funded The Way Home is a collaborative, public-private homeless response system that includes local governments, community stakeholders, nonprofit organizations, public housing authorities, and more, with the Coalition for the Homeless of Houston/Harris County at the helm. The collaborative effort works to address homelessness swiftly and effectively. Through unprecedented funding from COVID relief programs, The Way Home has continued to make strides in addressing homelessness. But further investment would shrink costs in the long term and uplift thousands more still living on the street.
As mainstream programs expire — like emergency rental assistance — more people are in danger of falling deeper into poverty and losing their homes. Allowing Americans to slip through our social safety nets and into homelessness will drain cities’ resources that could have been used to invest in less costly interventions that would prevent someone from experiencing homelessness — and the trauma associated with it — in the first place.
Biden’s proposed investment in housing would start to undo the devastating impacts of past short-sighted and fiscally irresponsible divestment in housing programs, restoring programs that once prevented Americans from falling into homelessness.
While not the focal point, President Biden’s plan to increase affordable housing stock and reduce housing costs exacerbated by inflation will be broadly beneficial for homeless populations — and in turn local governments and taxpayers. But more resources need to be funneled towards the nation’s most vulnerable so that homelessness can become rare, brief, and non-recurring and the enormous cost of allowing Americans to become homeless can be avoided. When we commit to affordable housing, we are doing the right thing — both morally and fiscally.
Michael Nichols is the CEO of the Coalition for the Homeless of Houston and Harris County. Deborah De Santis is the President and CEO of the Corporation for Supportive Housing.
