History of Section 8 Housing

The Section 8 program has its roots in the Great Depression. In 1937, Congress passed the U.S. Housing Act, which represented the beginning of federal housing assistance in the United States. It provided funds to develop high-quality public housing units for low-income tenants. Local public housing authorities maintained and managed the units.

In 1961, the Housing Act was amended to create the Section 23 Leased Housing Program. Under this program, qualified low-income tenants were placed in private units leased by local housing authorities. Tenants paid a portion of the rent, and the housing authorities paid the difference between what the tenants paid and what the building's owner might have received in the open market. The housing authorities also maintained the buildings.

The Act was amended again in 1974 to create Section 8. This new law signified a switch in focus. Instead of developing and managing public housing, it sought to help low-income people who were spending too large a percentage of their earnings on housing. Federal funds now paid a share of rent in units renters chose on the open market. Since 1974, legislation has refined and restructured the Section 8 program several times.

Foreclosure sign in front of home in Stockton, Calif.
Photo by Justin Sullivan/Getty Images
Stockton, Calif. leads the nation in foreclosures. One in 30 homes there are in foreclosure, nearly seven times the national average. Foreclosures have exacerbated the already high demand for federal housing assistance.


Today, people who qualify for Section 8 assistance receive a voucher that pays for about 70 percent of rent and utilities. The renter is then responsible for paying the remaining 30 percent. Recipients may choose to live wherever they want, as long as the total rent falls within standards set by HUD.

The voucher program currently helps about 2 million American households pay rent. In addition, vouchers may sometimes be used to help low-income people make mortgage payments or buy a house.

Research seems to indicate that the Section 8 program is a success. It helps many families live above the poverty line, spend money on food and health care rather than rent, and improve their well-being. It helps families move into better, more stable neighborhoods. It substantially reduces homelessness, especially for families with young children. Surprisingly enough, it also reduces incidences of mental health problems such as depression [source: Center on Budget and Policy Priorities].

 

HUD Income Definitions

"Low income" isn't just a vague political term. For HUD, it has specific meanings:

  • A low-income household earns no more than 80 percent of local median income.
  • Very low-income households earn no more than 50 percent of local median income.
  • Extremely low-income households earn less than 30 percent of local median income [source: Center on Budget and Policy Priorities].


Does Section 8 sound like it might be right for you? Learn how to qualify on the next page.