CHA Vouchers Paying For High Rent Apartments

CHA Vouchers Paying For High Rent Apartments

Apparently a few lucky folks have CHA vouchers that are paying for them to live in some pretty expensive apartments. About a month ago we took on a listing to rent a townhome for $3300/ month - 3 bedrooms, attached 2 car garage, built in the last 15 years. All of a sudden I get an email from an agent: "Wanted to find out if your accepting the Mobility Program  Vouchers  for  this unit . have a client that interested but wanted to confirm first . Program info attached to email. Mobility program will cover all  Rent up to .$4k for 3bedrooms."

What the....? We don't do a lot of rentals (Only as favors to clients. Tough, sleazy business.) so we had never heard of this program before. It didn't sound right. Vouchers that pay $4000 for a 3 bedroom townhome? What kind of government program is this?

Following the links provided didn't really answer the questions I had - like how much this program really pays out and who qualifies and what properties qualify. But then on Saturday Crain's published this article on what seems to be the same program: Poor families use 'supervouchers' to rent in city's priciest buildings

According to the article the CHA is getting the funds from the US Department of Housing and Urban Development. Normally the CHA would be limited to providing no more than 110% of what they determine to be the fair market rent in Chicago - currently at $826/ month for a 1 bedroom unit. However, the CHA got an exception from HUD and can actually pay out up to 300% of the fair market rent in order to provide poor people access to what are considered opportunity areas with access to better jobs and school.

How they define opportunity area is a bit curious. Most of Wicker Park for instance is not an opportunity area - except for a narrow slice. The Gold Coast is an opportunity area, as is all of the downtown area and most of Lincoln Park.

The Crain's article provides an example of one person/ family living in a one bedroom apartment at 500 N Lake Shore Dr. at a cost of $2673/ month - a building that is "the second most expensive in the city...with its sweeping views of Lake Michigan, a concierge and a dog-grooming center." Another family of three is staying at The Streeter at 345 E Ohio at a cost of $3060/ month. Meanwhile over 15,000 people are on the voucher waiting list.

Interestingly the Crain's article says that "Voucher holders generally must pay up to 30 percent of their monthly income, if they have any, to cover rent and utilities". That may or may not be consistent with what that realtor claimed in the email they sent me - that the CHA is paying the full bill. It could depend on the circumstances.

You can find more information on the program here: CHA Mobility Counseling Program.

Personally, I actually like the idea of vouchers for poor people. The last thing I want to see is the government in the real estate business. We've seen how that worked out. But is this the best way to allocate scarce public assistance dollars?

If you want to keep up to date on the Chicago real estate market, get an insider's view of the seamy underbelly of the real estate industry, or you just think I'm the next Kurt Vonnegut you can Subscribe to Getting Real by Email. Please be sure to verify your email address when you receive the verification notice.

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    Gary Lucido

    After 20 years in the corporate world and running an Internet company, Gary started Lucid Realty with his partner, Sari. The company provides full service, while discounting commissions for sellers and giving buyers rebates.

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