Many Americans understand how difficult it can be to pay for basic necessities and may wonder if low income housing apartment rentals can help. Renters who earn at or below 30% of their area’s median income often do not have the living conditions that they need. The shortage of low income housing in the country is more than three million units. However, there are a number of apartment rental programs and initiatives intended to close this gap.
If you are interested in applying for rental assistance, it is good to understand the function of low income housing rentals. You should also know how low income housing programs work, the financial limits for this assistance, and eligibility information for low income housing. There are many important factors to consider about low income housing apartment rentals that will help you get the most help from these programs.
The function of low income housing apartment rentals
These assistance programs strive to help families in need receive housing that meets the minimum standard in the country. Combined expenses for rent and utilities will be attainable for a family if they do not spend more than 30% of their earnings on basic living. Although housing assistance is available, the extremely limited number of available affordable rental units results in overcrowding in many areas. Many people live in unacceptable living environments or spend over half of their earnings on rent because low income apartment rentals can be hard to find.
How low income housing programs work
Typically, low income apartment rentals are made possible with either a direct or indirect subsidy. The United States Department of Housing and Urban Development (HUD) uses direct subsidies to provide or oversee the vast majority of low income housing in the country. There are approximately 1.2 million U.S. families and individuals living in HUD units. Section 8 provides renters who qualify with a subsidy that they can use to cover the portion of their rent that exceeds 30% of their earnings.
In cities with high real estate rates, it is not uncommon to find use of indirect subsidies. In most instances, indirect subsidies mean that private contractors subsidize low income rental construction. For example, in San Francisco, the Below Market Rate program says that developers must mark 15% of the units affordable in new construction buildings with five or more units. If the builder opts to construct affordable units off-site, the figure increases to 20%. In New York City, for-profit developers are granted space beyond the allowed city zoning code to construct low income housing units.
Financial limits for low income housing apartment rentals
HUD uses the American Community Survey data to determine annual earning limits for their housing programs. This group uses household size and an area’s median income to establish these limits. Typically, families fall into one of three income level categories. “Extremely low” is annual income at or less than 30% of the area’s median income, “very low” is at or less than 50%. “Low” is at or less than 80%.
Eligibility for low income housing apartment rentals
The primary qualification for low income housing eligibility is income. HUD allows families with annual incomes at or less than 50% of the area’s median income to apply for a Section 8 housing choice voucher. For public housing, the limit is 80%. Depending on the specific program, the limit may vary slightly. For example, in San Francisco, families at or less than 55% may apply for low income housing programs.
Important factors to consider about low income housing
A family must use their local housing authority (HA) to enter into a public housing rental agreement. For the Section 8 program, a tenant signs a contract with the local HA that details the assistance payment terms. A tenant also signs a lease with the private market landlord. Section 8 renters must adhere to the landlord’s lease terms or they may face consequences as permitted by applicable law, including eviction.
Assertive Management Group, part of Hope Housing Foundation (HOPE), in McKinney, Texas, helps individuals and families receive the support they need. We also work with students and seniors to provide the housing that they require. In order to better our community as a whole, we’re involved in a number of local initiatives including resident services, development programs, and educational scholarships. To learn more about our services, call us at (214) 842-8383 or Contact Us by email.