Estimating the Cost of Rental Assistance in Connecticut

Sizing Federal Rental Assistance

Millions of renters have lost their jobs during the COVID-19 pandemic, making the need for unemployment assistance and rental assistance especially urgent.

We use data from the Bureau of Labor Statistics and the American Community Survey to estimate how many renters lost their jobs between February and August 2020. We then use these estimates to determine how job loss, combined with different levels of unemployment assistance, affects rent burden. Lastly, we estimate the cost of providing additional rental assistance to keep renters stably housed through the pandemic and resulting economic downturn. For more details on the methodology, see the appendix (PDF) to our June brief.

This table shows the number and share of renter households in Connecticut at each income level that lost at least one job between February and August 2020.

Job Loss by Household Income

 
Connecticut
National
Household income Households with job loss Share of households Households with job loss Share of households
Below 30% of AMI 8,042 5.7% 584,692 5.6%
30-50% of AMI 7,563 9.0% 690,655 9.8%
50-80% of AMI 12,720 14.1% 1,113,771 12.7%
80-100% of AMI 5,454 13.2% 624,793 14.3%
100-150% of AMI 8,319 13.8% 1,145,680 16.5%
150%+ of AMI 9,280 17.4% 1,105,242 17.7%
Total 51,378 10.9% 5,264,833 12.0%

This chart compares the share of renter households facing rent burdens in February 2020 (the “Before job loss” column) with the share that, because of job losses, would have faced rent burdens in August 2020 under three unemployment insurance (UI) options. The second and third options include supplemental federal payments, similar to those authorized under the Coronavirus Aid, Relief, and Economic Security Act.

How Different Unemployment Assistance Options Affect Rent Burden in Connecticut

We analyzed what it would take to return all renter households to their prior levels of rent burden in two ways: through income supports and through rental assistance. Income supports like UI restore the money lost from employment shocks, while rental assistance helps households through financial support of rental payments. Income supports are substantially costlier than rental assistance, but they provide financial support to households beyond just covering rent.

These cost estimates represent the cost of returning households that experienced job losses to their rent-to-income ratio before the COVID-19 crisis. Households that had a rent-to-income ratio below 30 percent receive enough assistance to get to a 30 percent rent-to-income ratio.

Monthly Cost of Returning Households to Prior Rent Burden, with a Cap of 30 Percent in Connecticut

Method Households With no aid With state
UI benefits
With state
UI benefits
+ $300/week
With state
UI benefits
+ $600/week
Income supports 51,378 $173,383,832 $57,972,276 $37,069,784 $32,911,447
Rent supports 51,378 $37,920,783 $24,363,125 $13,813,284 $12,085,155

The COVID-19 crisis exacerbates an existing housing crisis. Members of low-income households were less likely to be working before the economic shock, so they are less likely to receive support that is provided only to those who lose their jobs. Therefore, we also estimate the amount needed to alleviate rent burden for all renters, not just those directly impacted by COVID-19-related job loss. To answer this question, we only looked at the cost to supplement rental payments and not to replace lost income.

Monthly Cost of Alleviating Rent Burden through Rental Assistance in Connecticut

Households With no aid With state
UI benefits
With state
UI benefits
+ $300/week
With state
UI benefits
+ $600/week
469,322 $165,505,683 $154,452,002 $145,542,244 $140,658,107