Section 8 Housing Vouchers: Better Neighborhoods, Greater Mobility for Low-income Households?

Abstract

"Do housing voucher recipients live in better neighborhoods?" Using American Housing Survey data from 2007, I employ a propensity score matching technique to determine the effect of receiving housing vouchers on perception of neighborhood quality. I compare voucher recipients to two groups--eligible low-income renter households who do not receive housing assistance and public housing residents. The average treatment effect on the treated demonstrates that voucher recipients rate their neighborhoods as slightly better quality than both unsubsidized households and public housing residents, but only at a 20% significance level. Further, the study analyzes the question, "Are voucher recipients more or less likely to move based on neighborhood quality rating?" A logistic model with the key interaction variables of neighborhood quality rating with housing subsidy status reveals that voucher holders are not more likely to move based on neighborhood quality. In fact, holding neighborhood quality constant, unsubsidized households are more likely to move than voucher holders at a 20% significance level. The findings suggest that the voucher program is falling short of its goal of providing a higher quality of life for the low-income households it serves, as measured by neighborhood quality ratings. However, it does provide evidence that voucher improve the stability of voucher households over eligible but unassisted households. Based on the findings, policy recommendations include provision of better information to recipient households, an easier application process for potential landlords, and incentivizing landlords in high quality neighborhoods to rent to voucher recipients.