Top 5 Immediate Takeaways from HUD’s Primary Annual Report on Homelessness

1. Homeless Services Systems Housed More People in 2025, But Large Numbers of Individuals Still Need Housing

Homelessness programs have housing units for just 9.5 percent of people in need but still helped 642,451 formerly unhoused people pay rent in 2025: an increase of four percent. With more funding, these programs would end homelessness – once in permanent housing programs, 93 percent of people do not reenter homelessness. 

These efforts to house more people must be understood in the context of a few important trends impacting homeless services: 

• People continue to struggle with affordability, finding it difficult to make ends meet. 
• New people enter homelessness every day. Over the course of 2024, 912,807 people experienced homelessness for the first time. 
• The expiration of emergency funding made available during the Covid-19 pandemic increased the crisis to a new scale. Between 2019 and 2025, homelessness grew 31.3 percent across 48/51 states and DC.  
   

2. Insufficient Services for Individuals with Disabilities Are a Chief Concern: Cuts to Funding Would Make Homelessness Worse For This Group

Since 2016, the number of chronically homeless individuals, defined as people with disabilities experiencing long-term or repeated instances of homelessness, has surged. Permanent Supportive Housing (PSH) keeps people experiencing chronic homelessness housed by offering them long-term rental assistance, paired with voluntary services like healthcare. While Congress never funded PSH adequately to house everyone experiencing chronic homelessness, relatively large increases in PSH helped reduce homelessness among this group by 35 percent between 2008 and 2016.  

               

As the number of available PSH units grew more slowly than the number of people with a disability experiencing prolonged homelessness, this trend reversed. On the day of the 2025 PIT Count, there were only enough PSH units to help, at most, 32 percent of this chronically homeless population and the waitlist continues to grow. Despite these large shortages, homeless service providers housed 354,397 people who were previously experiencing chronic homelessness in PSH: more than double the number of people experiencing chronic homelessness. 

More PSH would lead to reductions in homelessness: 96 percent of people placed in PSH remain stably housed (either staying in PSH or exiting PSH to other housing). Instead of funding this housing option that successfully ends homelessness for people with disabilities experiencing long-term homelessness, the president’s proposed budget for FY27 seeks to eliminate one of its primary federal funding streams. This would undermine efforts to prevent chronic homelessness. With more resources for PSH, homeless service providers could house everyone in need. 

The Administration is further seeking to harm people with disabilities experiencing long-term homelessness by expanding wasteful and inhumane policies that punish people for sleeping outside, even when they have nowhere to go. The majority of people experiencing chronic homelessness live unsheltered (58.8 percent) making them a primary target of punitive policies. This will certainly make homelessness worse and endanger this already vulnerable group. 

3. Racial Disparities are Continuing to Persist Within Homelessness

Homelessness is a major challenge for all types of Americans, but groups of color continue to be the most impacted. Years of discrimination in policy and practice have made it more difficult for people of color to find and afford a home. This is evident in disparate rates of homelessness. Policies like the Fair Housing Act seek to respond to some of these barriers by prohibiting discrimination in housing. Enforcing discrimination protections would help efforts to end homelessness by ensuring no one faces additional barriers finding housing. The current administration is choosing to undermine efforts to prevent discrimination, putting progress at risk. Policies that ignore these disparities will not end homelessness. 

Being a part of more than one marginalized group can increase hardships. For example, although the administration abruptly stopped reporting homelessness data by gender, external national surveys and data from previous years make it clear that gender-expansive people of color face even greater challenges, in large part due to discrimination. For example, approximately 1 out of every 2 gender-expansive, indigenous or black individuals will experience homelessness in their lifetime. 

4. Progress is Being Made on Unsheltered Homelessness in Some States and Cities

While the response system does not have the capacity to serve everyone in need, it is responding to the unsheltered crisis that began to emerge in 2016, when a trend of declines in unsheltered homelessness was replaced with a trend of steady increases. These increases accelerated after the Covid-19 pandemic when housing prices soared and more people faced financial challenges.  

Since that time, the response system has been connecting unsheltered people with support. In 2025, America experienced a decrease in the size of this population—the last time that happened was a decade ago. The share of unhoused people living outside, in their car or in another location that is not intended for humans to live declined in 25 states. However, states and communities need drastically more resources to respond to the greater demand for services and to end homelessness permanently. 

               

These reductions in unsheltered homelessness occurred across geographies but major cities are making the most progress reducing homelessness. Places like Los Angeles County reduced unsheltered homelessness by 9.5% by focusing on expanding permanent housing and voluntary services for people living in encampments. While nationwide progress is promising, more resources are urgently needed to accelerate progress across all community types. 

               

5. A Relatively Small Amount of Funding Would End the Crisis: Cuts Threaten to Make it Worse

Congress could fund an end to homelessness nationwide. The estimated 9.6 billion dollars required to house everyone living in a shelter during a given year is a small fraction of other federal programs. For example, just over one percent of annual funding for the Department of Defense is enough to house every person experiencing homelessness. But the Administration’s proposed cuts to homeless services along with recent changes to Medicaid, Supplemental Nutrition Assistance Program (SNAP), Supplemental Security Income and other supports will hurt response workers’ efforts and make the crisis worse. Instead, the nation should strengthen homelessness and housing programs, improving the well-being of over 700,000 people and making communities better places to live for everyone.