Study Data Show that Housing Chronically Homeless People Saves Money, Lives

written by naehblog
June 30, 2015

This blog post was written by Alliance research fellow Kaitlyn Snyder.


Homelessness costs taxpayers a lot of money. Take, for example, the infamous case of Murray Barr, aka “Million Dollar Murray,” a chronically homeless man in Reno, Nevada who accrued more than a million dollars in emergency room, substance abuse treatment, police, jail, ambulance, shelter and other costs.

Despite all these costly interventions, Barr ultimately died homeless on the streets. His tragic case highlights the need for a cost-effective solution to chronic homelessness. Cost studies demonstrate that Permanent Supportive Housing (PSH) is that solution.

Based on the Housing First philosophy, PSH reduces the need for costly public services by providing chronically homeless people with permanent housing at a subsided rate, along with supportive services to help them maintain their housing.

Research has shown that it’s more effective than shelters and transitional housing systems at housing the ‘hardest to serve’ individuals, who often struggle with complex and overlapping health, mental health, and substance abuse disorders.

In Denver, PSH saved $15,733 per year, per person in public costs for shelter, criminal justice, health care, emergency room, and behavioral health costs. The savings were enough to completely offset the cost of housing ($13,400) and still save taxpayers $2,373.



Researchers have already conducted cost studies like this one in communities across the country. The map below shows the PSH cost studies that we at the Alliance are currently aware of. The majority of these studies show significant savings that completely or nearly offset the cost of housing.


- PSH Cost Study

Has your community conducted a cost study? If so, the Alliance wants to hear from you. We advocate for increased investment in PSH, because we know it ends chronic homelessness. By demonstrating how this intervention saves taxpayers money, we can convince lawmakers that such investment will benefit their communities and constituencies.

You can help us by submitting a PSH Cost Study from your community to pshcosts@naeh.org.

Spending millions of dollars on emergency costs does little, if anything, to solve the problem of homelessness. Instead, we could be using those same millions to fund PSH and prevent premature deaths, like those of Murray Barr and countless others.