Do homelessness prevention programs work? Santa Clara County-based study says yes

The adage “prevention is better than cure” applies not just to health, but to homelessness, too.

A new study suggests that relatively modest financial efforts to prevent homelessness have been remarkably successful at keeping people off the streets. Specifically, it found the delivery of emergency financial assistance to at-risk families in Santa Clara County reduced the risk of homelessness: vulnerable residents receiving such assistance were 81% less likely to become homeless within six months and 73% less likely within 12 months.

“Our study shows that financial assistance almost totally reduces the chance of somebody having the really severe outcome of becoming homeless,” researcher David Phillips said. The study, conducted by the University of Notre Dame’s Wilson Sheehan Lab for Economic Opportunities, was published earlier this month.

The research focused on two groups: families receiving financial support through the county’s Homelessness Prevention System and families that did not get such help. Those receiving assistance –averaging nearly $2,000 — used the money to pay rent, utilities and other housing-related expenses. The study was conducted between July 2019 and December 2020.

“There’s a group of people who aren’t able to receive financial assistance just because there’s not enough funding available. In that group, about four out of 100 will enter an emergency shelter in the few months after requesting assistance,” Phillips said. “The study found that when financial assistance enters the picture, that rate reduces almost to zero.”

The researchers also found that the benefits of the prevention program exceeded the costs. Beyond the cash assistance for families, landlords benefited because they avoided needing to fill vacant properties and the broader community likely benefited, the study said, from a reduction in violent crime.

According to the 2023 Point-in-Time Homeless Census, 9,903 people are living outdoors in Santa Clara County, 1% less than the previous year. The homelessness prevention system has helped more than 14,000 people at imminent risk of homelessness since it was launched in 2017, according to Destination: Home, which co-leads the program.

Destination: Home gathers funding from federal, county and city governments as well as private foundations and works with a network of 19 nonprofit partners to run the Homelessness Prevention System with the county.

“There’s been a tendency in the past to be skeptical of prevention because of a perceived difficulty in identifying who’s going to become homeless in the future,” Phillips said. “Our study pushes back on that a bit and says we have a good bit of evidence now that these programs really can be effective and we should be thinking about them as one of the key tools.”

But if you can only afford a couple of tools, which do you use? Steve Berg, chief policy officer at the National Alliance to End Homelessness, said prevention efforts that are well-targeted at the most vulnerable people really do succeed. “However, it’s still the case that if you have a limited amount of money to reduce homelessness, the money has the biggest impact when targeted at those who are already homeless,” he said.

Still, Destination: Home CEO Jennifer Loving said not enough money has been allocated to homelessness prevention. “Outside of COVID, the federal government hasn’t looked at prevention as a strategy to end and prevent homelessness,” she said. “Prevention isn’t funded the same way money flows for other initiatives. It hasn’t been a focus.”

The Notre Dame study should be used as a model to establish homelessness prevention programming throughout the country, she said.

“The formula of public and private money together allows for the greatest flexibility,” Loving said. “And our community partners know where the needs are.”

According to the nonprofit National Low Income Housing Coalition, Bay Area residents have to make more than $50 an hour to reasonably afford a market-rate two-bedroom apartment. Minimum wage in San Francisco is about $18, which is on the high end for the region. The average rent for a two-bedroom apartment in the region is more than $2,500.

“Programs like this are going to continue to be necessary until this country decides to do what we should have been doing for the last 50 years — building deeply affordable housing at scale,” Loving said,

Phillips said they chose to conduct the study in the Bay Area because it has one of the highest rates of homelessness in the country and is extremely expensive.

“We thought if we’re going to figure out what works, let’s do that in a place where a lot of people could benefit from it,” he said. “The Bay Area is more challenging than many other housing markets. We wanted to see if a program like this could be successful here so others could learn from it.”