Eliminating Chronic Homelessness
How One Program Changes Lives While Saving City Dollars
The U.S. Department of Housing and Urban Development (HUD) estimates that the number of homeless individuals has fallen by 13 percent since 2007. However, homelessness remains a huge problem for many cities across the country. Cities ranging from New York to Seattle to Dallas find themselves confronting homelessness crises.
Of particular relevance is chronic homelessness, which HUD defines as individuals that have been homeless for a year or more or have been homeless on four separate occasions in the past three years and have a disabling condition (the HUD defines a disabling condition as being a diagnosable substance abuse disorder, serious mental illness, developmental disability, or chronic physical illness or disability). Chronically homeless individuals are among the nation’s most vulnerable and most in need of assistance.
In recent years, cities have been taking strides to end chronic homelessness. To do so, they’re increasingly utilizing a strategy known as Housing First.
The Housing First program
Housing First is based on the approach that the most immediate need for a chronically homeless individual is permanent and affordable housing. With housing secured, support services are then given to the individual to help them with any illness, disability, or substance abuse they may struggle with.
The Housing First program stands in contrast to programs that give housing to chronically homeless only after they’ve obtained some sort of treatment.
At the forefront of the development and research of Housing First is Dr. Sam Tsemberis who founded Pathways to Housing in 1992, the model of which would later come to be known as Housing First. From 1993 to 1997, Tsemberis implemented Pathways to Housing in New York City.
His research found that after five years, 88 percent of Pathways to Housing’s tenants remained housed, compared to only 47 percent of tenants in the city’s residential treatment system.
Housing First expanded through a two-year HUD demonstration project in Washington, DC. The research once again showed that the method delivered positive results across the spectrum. The program saw a housing retention rate of 97 percent in the first year and 84 percent in the second year, coupled with reductions in psychiatric symptoms, alcohol use, and demand for intensive support services.
The success of Housing First across the nation: Helping people, helping cities
In 2003 Dr. Tsemberis’ Housing First approach drew interest from Utah businessman and new lead of the Utah Housing Task Force, Lloyd Pendleton. Utah has now been running the program for over a decade and the results are stark: The number of chronically homeless individuals in Utah has dropped by a massive 72 percent — from 1,932 to 539. Interestingly enough, Housing First is also good for the pocketbooks of cities that implement it: For example, before implementing Housing First, Utah was spending about $20,000 per chronically homeless person.
By implementing the Housing First program, those costs have been slashed by nearly 50% — saving Utah $8,000 per chronically homeless person annually.
The strong, positive results from Utah garnered national attention. Since then, cities across the country have begun to discuss and utilize the Housing First model. In addition to DC, the model is currently being implemented in Vermont and Philadelphia — both of which are garnering 85% retention rates — indicating that Housing First could be an excellent model for cities looking to both help the chronically homeless and cut costs associated with chronic homelessness.
Considerations for Cities Looking to Implement the Housing First Program
Though Housing First has been widely successful, there are considerations to take into account before taking on the program.
As previously noted, the Housing First model relies on affordable and stable housing — and though clients usually do pay some rent, it’s imperative that the payments not be onerous. Typically, rent is either 30 percent of income (usually Supplemental Security Income) or $50 — whichever is greater. The gap between rental price and actual rental payments is a cost that cities need to think about when considering Housing First.
Secondly, order to implement Housing First, many cities need to build or lease the space — unless the city in question already happens to own a substantial amount of unused housing throughout the city. This means that for cities with soaring housing and rental prices — like that of DC displayed in the chart below — the initial investment for the Housing First model can, indeed, be a considerable undertaking.
Dr. Tsemberis’ work also focused on consumer-choice driven housing availability: The Housing First program allows clients to choose where in a city they’d like to live. For example, DC does this through using “scattered sites,” or Housing First apartments spread throughout the district. Allowing each client to choose where he or she would like to live helps foster a sense of home and self-efficiency.
A final consideration is that, if affordable housing is in limited supply, such as in New York City (shown below), giving chronically homeless individuals home location choices could be a significant initial investment. For example, cities implementing Housing First cannot purchase housing options only in low-value areas — under Housing First, they are also obligated to make housing available in the more expensive areas.
Moving Forward
As noted in the Washington Post article above, in the first three years following the beginning of the program in 2008, DC added more than 1,200 housing units for the chronically homeless, with nearly 600 built in just 2010. However, support for the project waned and by 2012 only 121 units were added. Luckily for DC, their new Mayor, Muriel Bowser, has made ending homelessness (and Housing First policies in particular) a priority — hopefully bringing much needed permanence to DC’s Housing First system.
Though there are considerable initial investments, cities should not let those investments scare them away from implementing the program.
The effectiveness of Housing First not only results in housing retention and reductions in psychiatric symptoms, alcohol use, and intensive support services, but Housing First can lead to significant cost savings for cities in the long run.
Utah isn’t the only place that saw significant return on investment: Research of Housing First in Seattle found reductions in the costs per chronically homeless person per month. Before utilizing Housing First, the median cost of serving a chronically homeless individual was $4,066 per person per month. Six months after implementation of Housing First, median cost of serving a chronically homeless individual had fallen to $1,492. And just 12 months after implementation, this statistic had fallen even further — to $958 per person.
Housing First offers cities a way to help solve chronic homelessness
Since 2007, the number of homeless individuals in the U.S. has fallen by 13 percent, while the number of chronically homeless individuals has fallen by 31 percent. By replicating the successful Housing First programs of Utah, DC, Vermont, and Philadelphia, cities can create a springboard for rehabilitating chronically homeless individuals—and saving city dollars in the long run.
About the author: Hunter Blair is a freelance economics writer with an M.A. in economics from Cornell University and a B.A. in math and economics from New York University. One of his favorite pastimes is sampling craft beer from various local breweries. Hunter is also a big sports fan — he enjoys playing soccer as well as watching the Falcons, Red Sox, and DC United with his two cats, Piper and Darwin.
