Sequester Cuts Impact Housing Assistance for Most Vulnerable

April 23, 2013— -- Housing agencies charged with helping the country's most vulnerable people find places to live are facing budget cuts due to sequestration.

The automatic budget cuts are set to reduce federal housing assistance by more than $2 billion this year alone, according to the Center on Budget and Policy Priorities.

Some of those cuts will come out of the Housing Choice Voucher Program. That program requires recipients to pay a percentage of their income toward rent and then gives them a voucher to cover the difference. A new report from the liberal Center for American Progress points out that sequestration could increase people's monthly rent payments by up to $200. That might not sound like much, but the average income for families who receive the vouchers is just $12,500.

Not only will the vouchers be for less money, but fewer families may receive the vouchers too. According to the CBPP, sequestration "will likely force state and local housing agencies to cut the number of low-income families using Housing Choice Vouchers to afford housing by roughly 140,000 by early 2014."

The budget cuts will also reduce assistance for homeless people. The CBPP warns that cuts to housing assistance could increase the risk of homelessness for some families.

Latinos make up 15 percent of all people receiving federal rental subsidies, according to the National Council of La Raza. And a 2012 Harvard study noted that fewer than half of Hispanics owned a home in 2011, meaning more than half rented. While home prices have dropped off some, rent prices have not.

Latinos were hit disproportionately hard by the foreclosure crisis and many who owned homes lost them and have been forced back into the rental market. According to a Latino Decisions survey, more than half of Latinos had to use their savings to make rent or mortgage payments.

That's especially discouraging because Latinos are particularly interested in owning a home. The survey indicated that more Latinos than not felt owning a home was an essential part of achieving the American Dream.