President Donald Trump’s fiscal year 2026 budget proposal would dramatically reshape federal housing policy. The proposal would cut nearly $33 billion from the Department of Housing and Urban Development (HUD) and effectively ending the Section 8 housing voucher program.
The budget blueprint includes a $26.7 billion reduction in federal rental aid—about 40% of HUD’s current budget. Instead of federally managed programs like Section 8, it proposes state-level grant systems with minimal oversight, leaving low-income families, older people, and disabled tenants vulnerable.
What about Section 8 change under the proposal?
Key aspects of the plan include:
- Eliminating Section 8 vouchers, shifting rental assistance responsibility to the states.
- Capping rental aid at two years for adults without disabilities.
- Ending federal fair housing enforcement, legal aid grants, and Biden-era housing equity programs.
- Consolidating homelessness services, prioritizing short-term shelter over permanent housing solutions.
- Slashing the Community Development Block Grant and HOME Investment Partnerships programs.
In total, the administration seeks to reduce HUD funding by 44%, one of the steepest proposed cuts in the federal budget.
Local housing officials raise alarms
The proposed cuts have triggered urgent warnings from local housing authorities. In Boston, where 18,000 households rely on Section 8, officials say the budget would create a “voucher cliff” forcing mass evictions.
“If the cut were ratified by Congress, the BHA would have to terminate almost 8,000 vouchers,” said Boston Housing Authority Commissioner Kenzie Bok. “We’d be talking about 11,000 children losing their homes.”
Officials have asked landlords to freeze or reduce rents and are urging property owners to lobby Congress.
Ripple effects across the country if Section 8 is gutted
California stands to be hit particularly hard. Millions rely on HUD funds for housing, legal aid, and homelessness programs. The state could face a steep rise in unsheltered homelessness if it loses permanent housing support.
“You’d be looking at millions of people out on the street virtually overnight,” said Matt Schwartz, president of the California Housing Partnership. “There’s no way states could maintain the same level of assistance.”
The administration defends the shift as a strategy to eliminate “dysfunctional” federal programs and give states flexibility. HUD Secretary Scott Turner called the budget “a bold reimagining” of affordable housing policy.
Housing advocates and lawmakers push back
National housing organizations are urging Congress to reject the cuts. The National Alliance to End Homelessness warns that the proposal could defund 166,000 units of permanent supportive housing.
Carolyn Chou of Homes for All Massachusetts said the budget could intensify existing housing instability: “People are already in crisis and can’t afford any more cuts.”
Fair housing organizations, which investigate housing discrimination, are also facing elimination of up to 75% of their funding. Advocates warn that enforcement of civil rights laws could effectively disappear.
What happens next?
Congress must approve the federal budget before the fiscal year begins on October 1. Lawmakers from both parties are expected to challenge parts of the proposal, especially given its broad implications for constituents and local economies.
While presidential budgets are often seen as aspirational, the scope and severity of the proposed HUD reductions have sparked widespread concern. Cities, states, and advocacy groups are mobilizing to prevent what many see as a looming housing catastrophe.
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