Subsidized housing is a

subsidy A subsidy, subvention or government incentive is a type of government expenditure for individuals and households, as well as businesses with the aim of stabilizing the economy. It ensures that individuals and households are viable by having acc ...

aimed towards alleviating

housing Housing refers to a property containing one or more Shelter (building), shelter as a living space. Housing spaces are inhabited either by individuals or a collective group of people. Housing is also referred to as a human need and right to ...

costs and expenses for impoverished people with low to moderate incomes. In the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

, subsidized housing is often called "

affordable housing Affordable housing is housing which is deemed affordable to those with a household income at or below the median, as rated by the national government or a local government by a recognized housing affordability index. Most of the literature on ...

". Forms of subsidies include direct housing subsidies, non-profit housing,

public housing Public housing, also known as social housing, refers to Subsidized housing, subsidized or affordable housing provided in buildings that are usually owned and managed by local government, central government, nonprofit organizations or a ...

, rent supplements/vouchers, and some forms of

co-operative A cooperative (also known as co-operative, coöperative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democr ...

and

private sector The private sector is the part of the economy which is owned by private groups, usually as a means of establishment for profit or non profit, rather than being owned by the government. Employment The private sector employs most of the workfo ...

housing. Increasing access to housing usually contributes to lower

poverty rate Poverty is a state or condition in which an individual lacks the financial resources and essentials for a basic standard of living. Poverty can have diverse

Types

Housing subsidies are government funded financial assistance programs designed to mitigate the costs of housing for

low-income Poverty is a state or condition in which an individual lacks the financial resources and essentials for a basic standard of living. Poverty can have diverse

tenants. Subsidies can be provided in the form of housing vouchers given to tenants, e.g.

Section 8 (Housing) Section 8 of the Housing Act of 1937 (), commonly known as Section 8, provides rental housing assistance to low-income households in the United States by paying private landlords on behalf of these tenants. Approximately 68% of this assistan ...

, or via direct deposits to landlords with government contracts to provide

Home mortgage interest deduction

The largest housing subsidy in the US is the home mortgage interest deduction, which allows homeowners with mortgages on first homes, second homes, and even boats with bathrooms to lower their taxes owed. The cost to the federal government of the mortgage interest deductions in 2018 was approximately $25 billion, down from $60 billion for 2017 as a result of the

Tax Cuts and Jobs Act of 2017 The Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018, , is a congressional revenue act of the United States originally introduced in Congress as the Tax Cuts and Jobs ...

. Some states also have the mortgage interest deduction provision. The majority of the home mortgage interest deduction goes to the top 5% income earners in the United States.

Rent subsidies

Some housing subsidies are provided to low income tenants in renting housing. These include shelter allowances, housing supplements, and shelter supplements from regional and local governments designed to help low-income households that spend a large proportion of their income on rent, such as

New York City New York, often called New York City (NYC), is the most populous city in the United States, located at the southern tip of New York State on one of the world's largest natural harbors. The city comprises five boroughs, each coextensive w ...

Family Eviction Prevention Supplement The Family Eviction Prevention Supplement was created by the New York City Human Resources Administration The Human Resources Administration or Department of Social Services (HRA/DSS) is the department of the government of New York City in char ...

program. The subsidies are often defined by whether the subsidy is given to the landlord and then criteria are set for the tenants they can lease to or whether the subsidy is given to the tenant, typically as a voucher, and they are allowed to find suitable private housing. The subsidy amount is typically based on the tenant's income, usually the difference between the rent and 30% of the tenant's gross income, but other formulas have been used. According to a 2018 study, major cuts in rental subsidies for poor households in the United Kingdom led to lowered house prices. In rare cases a financial institution or non-profit organization will provide mortgage loans at rates that are not profitable for the sake of a specific group. In Canada one such organization is Non-Profit Housing Subsidies Canada which provides subsidized mortgage loans to employees and volunteers of other non-profit organizations. Rent supplements are subsidies paid by the government to private landlords who accept low-income tenants. The supplements make up the difference between rental "market price" and the amount of rent paid by tenants, for example 30% of the tenants income. A notable example of a rent supplement in the

is Section 8 of the

Housing Act of 1937 The Housing Act of 1937 (), formally the "United States Housing Act of 1937" and sometimes called the Wagner–Steagall Act, provided for subsidies to be paid from the United States federal government to local public housing agencies (LHAs) to ...

(). Some

housing cooperative A housing cooperative, or housing co-op, is a legal entity which owns real estate consisting of one or more residential buildings. The entity is usually a cooperative or a corporation and constitutes a form of housing tenure. Typically hou ...

s are subsidized housing because they receive government funding to support a rent-geared-to-income program for low-income residents. In addition to providing affordable housing, some co-ops serve the needs of specific communities, including seniors, artists, and persons with disabilities.

Types

Home mortgage interest deduction

Rent subsidies

See also

References

Further reading