top of page

The Future of Subsidized Housing in America

Nearly a Century After the Birth of the First U.S Public Housing Program, What Does the Future Hold for Low-Income Housing in the United States?

Article Written by Felix Walther

Subsidized housing programs were first introduced in the United States in the 1930’s within Franklin D. Roosevelt’s New Deal package to provide relief to low-income households in the form of rental assistance during the Great Depression.

Additional programs and policies followed in subsequent decades, and in 2020, there were around one million public housing units in the United States.

In the words of The Baltimore Sun:

"There was a time when public housing sites were called 'the projects,' but over time that term became a pejorative, demeaning to the families who live there and placing a stigma on them. Today, we just call them communities or neighborhoods."

The set of subsidized housing programs are funded by the United States Department of Housing and Urban Development (HUD) and administered at the federal, state, and local levels through housing administrations which maintain subsidized (or public) housing.

The rental rates for public housing today are generally far below the market average, set at a percentage of the tenants’ household income (typically between 25-30 percent), allowing for more affordable housing in areas with rising inflation.

Although the programs initially experienced considerable measures of success, they have become increasingly controversial in recent decades due to several unforeseen negative effects.

As Generation Z struggles with finding its place in the economy, and grapples with rising housing prices, the need for Public Housing for young people will increase drastically in the years to come.

Low-Income Housing in Brooklyn, NY circa 1980

A Brief History of Public Housing Programs in the United States


Early efforts under the Public Works Administration’s Housing Division in the 1930’s were introduced under Roosevelt as a method of restructuring housing for Americans.

Legislation like the Housing Act of 1949 and the Housing and Urban Development Act in 1965 stimulated public housing and community redevelopment efforts.

The Housing Act of 1970 first produced the Experimental Housing Allowance (EHAP) program, which sought to determine how the use of housing vouchers (subsidies) would impact the housing markets, especially in developing urban centers (e.g. New York City and Chicago). After finding that vouchers would make markets for low-income housing more competitive, a proposal for subsidized Public Housing was made.

Construction of some units began and was followed by the Housing and Community Development Act of 1974, which established the Section 8 Housing Program and subsidy-system upon which current models are predicated. The program would encourage construction of affordable housing by private-sector businesses, while also creating the impactful Community Development Block Grants (CDBGs) that funded public housing and community development projects.

The 1980’s and 1990’s can be described as the most prosperous period for Public Housing in the United States, with considerable governmental financial support and proactive efforts for more inclusive urban development.

Under the George H. W. Bush administration in the 1990’s, public housing projects experienced a stimulus through additional funding and the HOPE VI funding program which destroyed, reconstructed, or relocated many older Public Housing projects that had experienced considerable degradation.

However, following 2004, budget cuts were continuously made and the programs quickly declined, leading these neighborhoods to garner increasingly negative connotations.

Ruins of Public Housing Units in Newark, NJ circa 1990’s

Why Did Public Housing Projects In the U.S Ultimately Decline?   

Along with budget cuts from the federal administration, there were also other reasons for the decline and increasingly negative public perception of low-income housing.

The most notable of these was the observation that Public Housing Projects for low-income families tended to increase both the concentration and severity of poverty in the areas in which they were located. Higher-income families would often emigrate from the area due to social issues associated with poverty, affecting the surrounding housing market and lowering prices — a phenomenon known as ‘white flight.’

As poverty concentration subsequently increased in public housing communities, a range of other issues emerged. From lacking educational quality, heightened crime rates, and social isolation, to informal racial segregation and social stigma, subsidized housing grew in infamy.  

The original housing projects envisioned by Roosevelt and his contemporaries produced segregated Public Housing Units, with those of white Americans typically being of higher quality, while Black Public Housing communities typically experienced greater concentrations of poverty.

In combination with the economic disadvantage already systemically imposed upon African-Americans, the Public Housing projects became disproportionately inhabited by minority groups, especially people of color.

Moreover, a trend of social isolation quickly became apparent in such communities, as there was limited interaction between residents and other higher-income regions. This reinforced the cycle of poverty and made ‘escaping’ poverty much harder for residents of Public Housing tenements.

Furthermore, heightened crime rates were a result of the increasing social isolation, as well as stigma associated with living in a Public Housing unit. Through high exposure to crime and little observation of behavior in mixed-income regions, children in subsidized housing frequently lacked positive role-models and economic prospects.

These observations — combined with extreme cuts in funding — eventually led to the decline of Public Housing into the deteriorated state of these communities as we know them today.

Is There a Future for Public Housing in the United States?

Is there any hope for Public Housing projects to improve in the future in the U.S? And if so, what will it look like? How will it address the aforementioned issues observable in low-income communities today?

For answers to these questions, successful Public Housing Projects like the Savonnerie Heymans units in Brussels, Belgium may provide some insight for what characterizes successful Public Housing.

A government-funded, privately constructed public housing community built amidst the bustling city center of Belgium’s capital, the Savonnerie Heymans community is a remarkable success story.

But what has made it so successful?

The units are built in a variety of building types, from single-family lofts to studio apartments. The complex includes countless communal spaces and commons, boasting playgrounds, game libraries, and other facilities which foster the social environment within the complex.

The complex is built with high population density in mind, being one of the most energy-efficient and socially active public housing facilities in the world, using renewable energy and water sources such as rainwater collection and solar panels.

The Savonnerie Heymans Public Housing facility in Brussels, built from an old soap factory. Image credit: Serge Brison, 2012

One notable feature of the housing is the location at the city center among other non-subsidized/public housing, allowing the residents to smoothly integrate themselves into the mixed-income, inner-city community. This eliminates issues like social isolation, stigmatization, and concentrating poverty.

Similar communities elsewhere in Belgium, like the Le Lorrain community, or those in France boast some of the most modern housing developments in the world, while being home to the lowest income groups in their respective country.

Designed and constructed by private firms (with financial government incentives), these housing units provide affordable housing through government subsidization and rental assistance, while focusing on providing communal spaces and income diversification for residents to fight issues afflicting public housing communities like those in the U.S.

Mixed-income communities as such foster an environment where Public Housing is not associated with poverty, crime, and infamy, but rather with state-of-the-art and environmentally friendly housing units that blend in with surrounding areas.

On a positive note, similar concepts have been recently introduced in the U.S through scatter-site housing, a form of subsidized housing located in mixed-income areas with little outward distinction from surrounding neighborhoods.

There is still government support for Public Housing concepts in the U.S, although it has waned in the most recent decade. Restoring confidence in, and developing better, affordable housing may just be enough to give the concept a fighting chance in the United States, which Generation Z desperately needs.

What are your thoughts? Please share this article with your comments.

Felix Walther is a contributing writer for


bottom of page