Housing First Under Threat: How Project 2025 Targets Homelessness Policy

by Margaret Hodge, Analytics and Fundraising Strategy Intern

For many decades, Housing First has been one of the most effective tools the U.S. has to address chronic homelessness. The approach aims to provide people with permanent housing first without preconditions like sobriety, treatment, or employment and then offer voluntary supportive services. Now, there has been a proposed removal of this under Project 2025.

What Is Changing?

On July 24, 2025, an executive order was signed that drives a major shift in federal homelessness policy. The order calls for ending Housing First grants completely because they believe that this model has failed, even with extensive evidence showing the opposite.

Instead, the administration is pushing a “Treatment First” model that would require individuals experiencing homelessness to participate in addiction treatment, mental health services, or job training before they qualify for permanent housing. This change would directly impact the U.S. Department of Housing and Urban Development (HUD) which is the primary federal agency that funds homelessness response efforts across the country.

Why Housing First?

Housing First is a data-backed strategy used nationwide, including here in Massachusetts. Research has shown that people placed in Housing First programs stay housed longer and are more likely to still be housed two years later compared to those in treatment-first programs. Stable housing also significantly improves outcomes for individuals with mental health challenges and substance use disorders. It is one of the most effective ways to address chronic homelessness, especially for people with complex needs.

In Massachusetts specifically, it was found that individuals placed in Housing First programs experienced a roughly $10,000 reduction in inpatient care, emergency department visits, and mental health services compared to those who remained unhoused. 

Making Economic Sense:

• Economic Stability: Housing First provides more durable housing outcomes than treatment-first models, which can see higher rates of leaving programs and returns to homelessness.

• Cost Effectiveness: According to the National Alliance to End Homelessness, one study found an average savings of $31,545 per person over two years in emergency services, and another showed Housing First programs could be $23,000 cheaper per year than shelter programs.

• Hospitalization and ER Visits: A Blue Cross Blue Shield of Massachusetts Foundation report found that compared to a control group, the Housing First cohort had 17% lower total medical spending and 17% to 18% lower emergency care expenditures. 

At a time of rising rents and widening income inequality, Housing First helps counteract what is driving homelessness nationwide. However, the proposed removal of Housing First grants has already created widespread uncertainty. 

• Housing providers are stuck in limbo, waiting for federal funds that are delayed or at risk of disappearing.

• Funding awards from the National Alliance to End Homelessness are set to expire between January and June, and many programs may run out of money before renewed funding arrives.

• Local governments and nonprofits cannot plan or propose alternative programs until federal courts issue final rulings.

• 2024 and 2025 projections show a dramatic decrease in available housing units and shelter beds if these changes move forward.

  
  

The administration has now rebranded Housing First as a “far-left idea,” arguing that homelessness is mainly a behavioral issue rather than circumstantial. This framing ignores decades of evidence showing that housing stability is the foundation needed to address substance use, trauma, unemployment, and mental health challenges. Massachusetts and other states such as Washington and New York have responded by suing the federal government, pushing back against Project 2025 and its attempt to dismantle a proven system without a viable replacement. 

Ending Housing First doesn’t reduce homelessness, it destabilizes the systems that have already been shown to work. This aspect of Project 2025 doesn’t just change policy such as Housing First but it creates chaos with real consequences for people, providers, and communities nationwide.