Source of Income Discrimination

A full-time worker who earns the minimum wage cannot afford adequate family housing anywhere in the country. In 42 states, two workers who earn the federal minimum wage do not make enough to afford adequate family housing. Three times the federal minimum wage is still insufficient in 13 states and the District of Columbia.1

Between 2000 and 2003, the number of low-wage households that spend more than 50 percent of their incomes on housing grew by 2.5 million. Today, more than one in eight American households spend more than half their incomes on housing.2 One in three Americans spend more than 30 percent of income on housing. Of course, housing costs affect the ability to pay for other necessities. Low-income households that devote more than half of income to housing spend an average of only $175 for food and $35 for health care each month. Households that spend less than 30 percent of income on housing average $248 on food and $109 on health care.3

Since 1993, the number of affordable rental units has decreased by 1.2 million.4 Low-income households rely on three types of subsidized housing: publicly-owned properties, project-based Section 8 programs (that is, projects administered by private property owners), and Section 8 Housing Choice Vouchers. Each of these types of low-income housing is becoming more scarce. Under the HOPE VI program, the federal Department of Housing and Urban Development has encouraged local public housing agencies to renovate or eliminate dilapidated public housing units. More than 60,000 have been demolished.5 Project-based Section 8 programs have folded as private owners scramble to take advantage of escalating real estate prices by converting their properties to market-rate housing.

Currently, only one in four families eligible for Section 8 vouchers are served by the program. In the past, families lucky enough to receive a voucher have often spent years on waiting lists—but the situation for low-income families is getting even worse. Under the Bush Administration, the number of new Housing Choice Vouchers has fallen sharply from a peak of over 130,000 in 2001 to about 30,000 (all of which will go to families losing other housing assistance).6

Federal fair housing law prohibits discrimination based on race, color, national origin, religion, sex, family status (including children under the age of 18 living with parents or legal custodians, or pregnant women), and disability. But in most states, landlords are permitted to discriminate against prospective tenants because they would pay with Housing Choice Vouchers. An Illinois study by the Lawyers’ Committee for Better Housing found that in the Chicago region, up to 70 percent of landlords refuse to rent to tenants who use Section 8 Housing Choice Vouchers.7

A 2001 U.S. Department of Housing and Urban Development study found that voucher holders had a 12 percent higher placement rate in areas that have laws protecting against source of income discrimination.8

Research consistently shows that communities with a range of family incomes have the resources to provide better schools, social services, and job opportunities, and are better able to help low-income families break the cycle of poverty. At the same time, families that spend less of their incomes on housing are able to spend more of their money in the community to boost local economies. They can also build individual assets and reduce personal debt.

Twelve states with diverse housing needs (CA, CT, ME, MA, MN, NJ, ND, OK, OR, UT, VT, WI) have amended their housing anti-discrimination laws to include source of income as a protected category. Several cities, including Chicago, Los Angeles, San Francisco and Washington, D.C., also prohibit housing discrimination based on source of income.