Can giving homeless people $750 a month to use any way they choose help them move into long-term housing?
I am the director of the University of Southern California Homelessness Policy Research Institute. My research team, in partnership with Miracle Messages, a San Francisco social services nonprofit, set out to answer that question in a study that will be published in an upcoming peer-reviewed issue of Social Work Research.
In one of the first randomized studies of basic income for homeless people in the United States, 103 homeless people living in California received $750 payments every month for a year.
Then we compared their housing situations with people who were homeless but did not receive this money. All study participants met the federal definition of literal homelessness. That basically means they either stayed in a homeless shelter or lived on the streets.
In 2022, when we began this study, we expected the answer to our question would be “yes.”
Beginning with optimistic expectations
A similar experiment in Canada with 50 homeless participants showed that providing 7,500 Canadian dollars in cash as a lump sum resulted in 99 fewer days homeless over a one-year period.
In addition, Miracle Messages had already completed a similar but smaller pilot in which six of its nine participants moved into long-term housing after receiving $500 monthly for six months.
But the results of pilots with so few participants can be misleading because the people who got money may have found housing anyway. What’s more, an experiment conducted in Canada may not directly translate to the U.S. — which has a weaker safety net than its northern neighbor.
Homelessness is often short-term for everyone
After receiving monthly payments for a year, nearly half of the participants in our study were no longer homeless.
But almost the same share of people who didn’t receive the payments had also found housing.
This points to an important reality: For many Americans, homelessness — while highly destabilizing — is often temporary. And, most people who are living on the street are actively trying to become housed.
Because the payments did not substantially change the rate at which participants obtained housing, we found ourselves asking another question: If the money didn’t alter housing outcomes, what did it change?
Most people are actively looking for housing when they experience homelessness. Photo by Milan Cobanov on Unsplash
How people spent the money
Basic income programs typically let people decide how to use the funds they get. Critics of giving people money with no strings attached often worry that they will spend it, or even squander it, on so-called “temptation goods,” such as alcohol and illegal drugs.
That isn’t what we observed.
The people taking part in this study overwhelmingly spent this money on basic needs, such as food, housing-related expenses, transportation, and health care. Spending on alcohol, cigarettes, and illegal drugs accounted for 5% of the money.
But those expenditures only tell part of the story. Cash also allowed people to meet their own immediate and personal needs.
One participant used this money to keep his car running — both for transportation to work and as the place where he slept at night. Another bought birthday and holiday presents for his relatives. One sent money to aging parents. Another donated to a charity because it restored a sense of contribution.
Another paid down credit card debt that had been a source of stress.
While we found no evidence that the basic income payments reduced homelessness, other aspects of the participants’ lives appeared to become more stable. We found no evidence that the money caused them any harm.
Why this result makes sense
The distribution of cash assistance has been evaluated in many places, usually targeting a specific kind of community, such as unemployed individuals or families living in poverty. Studies consistently find that people spend the money on necessities and end up better off.
Homelessness presents a different challenge.
Housing requires access to an available and affordable unit. In most U.S. housing markets, a $750 monthly payment doesn’t cover that month’s rent. Nationally, rent for a typical one-bedroom apartment was about twice that amount in February 2026.
Programs tied directly to housing, such as rent vouchers or subsidies, may therefore have a more immediate effect on housing status.
Moving forward, I believe our results suggest that for a basic income approach to help counter homelessness, monthly payments would have to be larger, continue over a longer period — or both. The payments should, that is, be closer to covering the full cost of a month’s rent in the local area.
This article by Benjamin F. Henwood, Professor of Social Policy and Health, University of Southern California, was originally published by The Conversation.
Header image by Timur Weber via Pexels
