Studies Find Short-Term Financial Assistance Promotes Housing Stability, Reduces Cost

Since its inception, the Opportunity Starts at Home campaign has urged Congress to create a "National Housing Stabilization Fund" to provide short-term financial assistance and stability services to help poor households overcome an economic shock that threatens their housing stability.
Most families in poverty who rent spend at least half of their incomes on housing, leaving virtually no margin for an unexpected expense. Broken-down cars, unreimbursed medical bills, or temporary declines of income can quickly send vulnerable households down the spiral of housing instability, eviction, and even homelessness. The primary purpose of a Stabilization Fund would be to cover the temporary gaps between income and rental costs during a financial crisis. The secondary purpose would be to provide stability services, such as counselors and case management. When combined, such short-term housing assistance and support services can significantly reduce evictions and homelessness. Some states and localities have these crisis assistance programs, but the need far exceeds the program resources available.
Although there is still more to learn about how to deliver emergency assistance most effectively at a national scale, families and individuals who have participated in similar types of programs often have permanent housing by the end of the program. Studies also find that providing a small amount of preventative, short-term assistance is more cost-effective than the long-term social and economic consequences of housing instability, eviction, and homelessness.
A review of research related to such programs:

  • A review of a recession-era program and its short-term assistance and prevention services components found 71.6% of participants who were either imminently losing their housing or unstably housed upon entry into the program exited to stable housing.
  • A review of the Supportive Services for Veteran Families’ (SSVF) prevention program, which provides short-term financial assistance and other supports to veterans at risk of homelessness, found 91% of participants maintained their housing or exited to permanent housing.
  • A rigorous evaluation of New York City’s Homebase Community Prevention program, which includes short-term assistance and services, found that families at-risk of homelessness who participated in the program spent 22 fewer nights in the shelter system. These families were also less likely to spend at least one night in shelters during the 27-month follow-up period.
  • Researchers examined the effectiveness of temporary financial assistance by using data from the Homelessness Prevention Call Center (HPCC) in Chicago, which processes about 75,000 calls annually. Chicago residents at-risk of becoming homeless would call 311 to request temporary financial assistance for rent, security deposits, or utility bills. The researchers compared households that called when funds were available with those who called when funds were not available. They found that those calling when funding was available were 76% less likely to enter a homeless shelter. The researchers also presented evidence that the program’s cost is lower than the homelessness-related costs the program likely averted, making the program a cost-effective solution.

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