Do Homelessness Prevention Programs Prevent Homelessness? Evidence from a Randomized Controlled Trial

Abstract

This paper provides the first evidence from a randomized controlled trial isolating the impact of financial assistance to prevent homelessness. In this study, individuals and families at imminent risk of homelessness were offered temporary financial assistance, averaging nearly $2,000 for those assigned to treatment. Our results show that this assistance significantly reduces homelessness by 3.8 percentage points from a base rate of 4.1%. The effects are larger for people with a history of homelessness and no children. Despite concerns about cost-effectiveness due to difficulty targeting, our estimates suggest that the benefits to homelessness prevention exceed costs.