Phoenix will soon consider offering private landlords $2,000 to rent to very low-income residents.  

The idea behind housing choice vouchers, commonly called Section 8, is to let people choose a private rental. The reality is too few landlords are willing to rent to them. 

“Part of the challenge being in the marketplace is that some of the investment companies are coming in and buying private market rate units from existing marketplace and raising rents to such an extent that it is not feasible for a voucher holder to rent from that location,” Titus Mathew, Phoenix Housing director, recently told a city subcommittee.

Since October 2020, Phoenix has been using federal coronavirus relief funds to offer $500 incentives per unit when a landlord executes a one-year contract with a voucher holder. Mathew presented options to a city subcommittee to offer up to $2,000.

“I think a $2,000 option would be a great incentive to private sector landlords because, hypothetically, I'll just give you an example, if a landlord has four voucher holders residing at a complex if they receive $8,000 I think that’s a game changer in terms of total rent they’re receiving from that client, or clients that are residing at that complex,” he said.

Voucher holders pay 30% of their income to rent and utilities while Phoenix covers the rest using federal dollars based on a fair market rent formula determined annually by the U.S. Department of Housing and Urban Development.

The city has 16,000 people on a Section 8 wait list, which is reserved for very low-incomes. In July 2021, Chandler increased its incentive to private landlords from $400 to $1,000. Mathew said Maricopa County and Tucson currently offer $500 and are considering increases. 

Members of the city’s economic development and equity subcommittee recommended staff present the $2,000 option to the full council for a vote.