For Los Angeles County, subsidized housing is a small but critical part of the overall housing system. After decades of underbuilding, the region now faces a severe mismatch between housing need and supply, which especially for low and moderate-income renters. Currently, Los Angeles has one of the weakest links between rising demand and new housing construction among major U.S. metros, meaning that even when rents climb, new units are slow to follow (Baum-Snow & Han, 2024; Gyourko & Krimmel, 2021). Beginning in the 1970s, the federal government shifted away from public housing and toward more complex, tax-credit–based financing, while Proposition 13 limited local revenue needed to support new development (Congressional Research Service; Legislative Analyst’s Office, 2015). At the same time, construction and land costs rose faster than incomes, making it extremely difficult to produce housing that low-income renters can afford without subsidy (Ward & Schlake, 2025). However, the need is far greater: state housing goals require more than 340,000 new affordable units by 2029, and countywide estimates show a shortfall of over 578,000 rental homes for households earning below 50% of area median income (SCAG, 2021; California Housing Partnership, 2025). In this context, subsidized housing is essential for addressing affordability because it creates units the private market cannot build and provides long-term rent stability for the county’s lowest-income residents.

Los Angeles County’s subsidized housing stock is supported through federal and state programs, each created to meet different financing and affordability needs. Federal programs administered by the U.S. Department of Housing and Urban Development (HUD)—including FHA-insured multifamily loans and project-based Section 8 contracts—primarily reduce development and operating risk or directly subsidize rents for low-income households (HUD, “Multifamily Housing Programs”; HUD, “Project-Based Rental Assistance”). State programs add an additional layer: the California Housing Finance Agency (CalHFA) provides below-market loans and tax-exempt bond financing for affordable multifamily projects (CalHFA, “Multifamily Programs”), while the California Department of Housing and Community Development (HCD) funds capital-intensive development through programs such as the Multifamily Housing Program (MHP), HOME, and supportive housing initiatives (HCD, “Multifamily Housing Program”; HCD, “Affordable Housing and Sustainable Communities”). Among all programs, the Low-Income Housing Tax Credit (LIHTC) remains the dominant driver of affordable housing production nationally and statewide, supporting the majority of income-restricted units built since the 1990s (IRS & HUD, “LIHTC Database”; NLIHC, “The Affordable Housing Gap”). Because properties often rely on layered financing that combines multiple subsidies to remain financially viable, many developments appear under several programs simultaneously (GAO, “Fragmentation and Overlap in Housing Programs”). As a result, the subsidized housing landscape reflects an overlapping set of funding mechanisms that collectively shape the region’s affordable housing supply.

Written by Katherine Ding