Federal Subsidy Overlap in Affordable Rental Housing in the United States

Abstract

The Low-Income Housing Tax Credit (LIHTC) and Housing Choice Voucher (HCV) programs are two of the largest affordable rental housing programs in the United States. The LIHTC assists in the development and preservation of affordable housing while the HCV provides subsidies to households to find housing in the private market. LIHTC and HCV in the form of tenant-based subsidy are often used jointly, but little research has been done to assess this overlap. This thesis explores the functionality of these two programs and how they are used together to address affordable rental housing needs in the United States. Through a systematic literature review and qualitative interviews with experts in the field, this research finds that the two programs serve different roles related to income levels served, neighborhood choice of tenants, and how they function in various markets. The research concludes that as LIHTC and HCV function currently, they serve a complementary role to one another, addressing housing needs that they do not meet as standalone programs. Specifically, joint use of the programs provides accessible housing options for households with vouchers and allows the LIHTC program to serve lower-income households without cost burden. The findings outline policy recommendations to help the standalone programs better address housing needs and discuss how they can function more efficiently together.