Reflections on Demand Assistance in the Rental Sector: A European Perspective

Demand-side or demand assistance with housing costs is known as housing allowance, housing benefit, or rent rebate in advanced economies and as housing vouchers in the United States. This type of assistance, which is also called a subject or person-based subsidy, aims to safeguard access to housing by making it affordable for consumers whose income is insufficient to pay for their housing costs.

This contribution aims to contextualize the newest development in the United States housing voucher implementation: the use of Small Area Fair Market Rents (SAFMRs) rather than metropolitan Fair Market Rents (FMRs) in the determination of the tenant subsidy amount. Some possible outcomes of this change in the design of the instrument are reported in three articles in this issue of Cityscape:

1. “The Effects of Small Area Fair Market Rents on the Neighborhood Choices of Families with Children” by Samuel Dastrup, Ingrid Ellen, and Meryl Finkel

2. “Impact of Expanded Choice on Tenure in the Housing Voucher Program” by Judy Geyer, Samuel Dastrup, and Meryl Finkel

3. “Small Area Fair Market Rents, Race, and Neighborhood Opportunity” by Kirk McClure and Alex Schwartz

This contribution summarizes these outcomes, after presenting a brief history of housing demand-side assistance schemes and their design characteristics. The contribution concludes by comparing different systems and the role played by demand-side assistance.