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Housing: Rent Supplements and Shelter Allowances
Rent supplements and shelter allowances are government-funded payments that bridge the gap between what households can afford to pay and what the actual cost of housing is. Basically, they are demand-side strategies that allow individuals to pay for and live in accommodations that they otherwise could not afford. These programs are most effective when there is adequate and affordable housing stock. A drawback of these programs is that they do not necessarily take into account market pressures, low vacancy rates, homelessness discrimination, accessibility, special needs, and the quality of the existing housing stock.

Shelter allowances go directly to individuals and are flexible in design. The dollar amount, for example, can cater to the needs of a particular group (e.g. seniors, people with disabilities) or a particular housing market (e.g. region, neighborhood). They can be made available universally to homeowners, renters and welfare recipients or restricted... to particular populations. Households that are experiencing temporary affordability problems, while living in decent and suitable housing, could greatly benefit from a shelter allowance.

Rent Supplements are more commonplace as a demand-side tool in Canada. They are a contract with a private landlord, not with the tenant. The subsidy provided to private landlords is used to bridge the gap between the monthly market rent charged for a unit and the rent-geared-to-income portion paid by the tenant. Rent supplements are often referred to as a practical way to provide affordable housing house that is faster than building new housing. In the long run, they are not effective in building a stock of affordable housing that is decent and suitable.

AUTHOR: Power, Asetha (2008) Homeless Hub. [Show More][Show Less]


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A Canadian Homelessness Research Network (CHRN) initiative. The CHRN has received financial support from the Government of Canada’s Homelessness Partnering Strategy and the Social Science and Humanities Research Council of Canada