President Donald Trump wants to slash $33 billion from the Department of Housing and Urban Development’s budget by eliminating key grant programs and overhauling rental assistance.
Trump on Friday released his proposed budget, which included recommendations to gut the agency’s budget by more than 40 percent in fiscal year 2026 compared to 2025, by reducing funding from $77 billion to $43.5 billion. Overall, the president proposed a $1.7 trillion spending plan, including $163 billion in cuts to non-defense discretionary spending.
Trump wants to cut $26 billion in funding for rental assistance voucher programs and to transform programs like the Housing Choice Voucher Program, or Section 8, into limited grants. The budget also calls for a two-year cap on “rental assistance for able bodied adults,” indicating that a majority of rental assistance funding would be dedicated to the elderly and disabled.
Rachel Fee, executive director of the New York Housing Conference, said the two-year limit on housing subsidies would “push thousands of people into crisis.” The Housing Choice Voucher Program covers a portion of rent for some 2.3 million low-income households across the country.
“It dismantles the federal safety net, shifts the burden of housing America’s poorest renters onto states and the private sector, and abandons millions of people in need,” she said, adding that the budget recommendations were “cruel and short-sighted.”
The president is also seeking to eliminate the Community Development Block Grant program, which sends financing to states and localities for housing and other projects, as well as the HOME Investment Partnerships Program, which provides funds for affordable housing.
In an interview with TRD last month, HUD Secretary Scott Turner hinted at some of the president’s proposals, saying that the agency was looking at term limits for certain types of assistance.
“My goal is not to grow the amount of people that are dependent upon the government,” he said. “Will we have those people in our country that need assistance? Absolutely, we will have those people, and we are very focused on serving that percentage and that specific part of our population.”
In a statement on Friday, Turner called the president’s proposals “bold” and reflective of the agency’s efforts to take inventory of all of its programs and eliminate bureaucratic bloat.
“It creates the opportunity for greater partnership and collaboration across levels of government by requiring states and localities to have skin in the game and carefully consider how their policies hinder or advance goals of self-sufficiency and prosperity,” he said.
The budget also calls for the elimination of the Pathways to Removing Obstacles Housing grant program, which provided funding to localities that took steps to “remove barriers to affordable housing,” such as outdated zoning and land use policies. New York received a nearly $4 million grant in the program’s first round for changes that allowed certain housing programs to avoid environmental review.
Trump’s budget indicates that it should be up to states and local governments “to address affordable housing and development challenges within their communities.”
For months, reports have predicted that Trump would propose significant housing cuts. That doesn’t mean the proposals will move forward. During his last administration, he repeatedly pitched massive reductions to HUD’s budget that did not come to fruition. This included a proposed $8.6 billion cut in 2020 by eliminating the HOME, Community Development Block Grant and other programs, as well as cutting funding for public housing authorities and housing vouchers.
Still, housing groups paint a grim picture if the proposals gain traction.
“If enacted, these cuts represent a serious threat to the safety and wellbeing of millions of Americans and will drastically increase the number of those facing housing instability and homelessness,” Christine Quinn, president and CEO of Win, a New York nonprofit that provides emergency shelter and supportive housing in the city, said in a statement.
Quinn said the potential cuts underscore the importance of a state-based housing voucher program. Gov. Kathy Hochul has indicated that she is willing to seed a state program with $50 million as part of the state budget. That funding would only support 5,749 people per year, according to Win.
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Hochul says state budget to include $50M for housing vouchers