HUD cuts expected to worsen America’s housing crisis, staffers say

Sharp cuts at the Department of Housing and Urban Development are likely to upend housing markets, make homes less affordable and roil mortgage transactions, according to current and former employees, contractors and housing experts.

The changes come amid a national housing crisis, with not enough homes and ever-rising costs. Current and former staffers, many of whom spoke on the condition of anonymity out of fear of reprisal, said it was increasingly difficult to answer how and whether HUD can carry out its core functions as the federal government’s top housing agency.

Those concerns have grown, they said, since officials from the U.S. DOGE Service, billionaire Elon Musk’s effort to slash federal spending and regulations, appeared at the department’s headquarters. HUD’s entire workforce is projected to drop by about half—from about 8,300 employees to just over 4,000—with deep cuts in field offices nationwide, according to an internal memo obtained by The Washington Post.

Top HUD officials and staff have also briefed workers on proposals to evict undocumented immigrants from public housing and impose time limits or work requirements for other residents, according to people who heard the talks.

“Actions like this will make it harder, not easier, for many folks to afford a place to live,” said Peggy Bailey, executive vice president for policy and program development at the Center on Budget and Policy Priorities. “Make no mistake, these employees live in communities across the country—not just in D.C.—and serve in regional offices that are the first line of support for people in need of help with housing.”

Created as part of President Lyndon B. Johnson’s War on Poverty in 1965, HUD oversees policies to tackle housing needs and enforce fair-housing laws. It also administers key programs for public housing and rental assistance through Section 8 vouchers. But its mission goes beyond anti-poverty programs: Its vast reach also includes roles in real estate, housing finance, mortgage insurance and more.

Expected cuts run the gamut. Billions of dollars for homelessness initiatives are paused, affecting the bottom lines of nonprofits and local governments nationwide. Millions of dollars in funding for projects that improve energy efficiency, indoor air quality and climate resilience for certain HUD properties has been stopped. A contract involved in inspections for affordable housing units was nixed.

Squaring such changes with HUD’s functions is becoming increasingly difficult, said current and former staffers. The Office of Community Planning and Development—which has a large portfolio spanning veteran housing, disaster recovery, homelessness and community block grants—will be cut by 84% by late May, according to the internal memo. The Office of Public and Indian Housing, which serves over 3.5 million households, will be cut by 50%.

The Office of Fair Housing and Equal Opportunity—which focuses on eliminating housing discrimination, including for the disabled—will be cut by nearly 77%. There is also the broad expectation that field offices, especially smaller ones in more rural parts of the country, will be shuttered. (Department officials said those numbers are in flux and not necessarily absolute.)

Staffers also emphasized that these cuts appear to contrast with President Donald Trump’s campaign promises to make housing more affordable. The Federal Housing Administration, which is part of HUD, is facing possible cuts of 40%, Bloomberg News reported Tuesday. FHA is one of the largest mortgage insurers in the world and generally has more lenient terms than private markets do to help people with lower credit scores, first-time buyers or those who can afford only small down payments buy homes.

Many employees said their instructions also seemed counter to DOGE’s focus on increasing accountability and government oversight. One employee in a field office, for example, relies on a travel budget to monitor public housing authorities and make sure they are spending funds appropriately. The employee was recently told that budget must be cut dramatically, so most oversight work will have to be done remotely—making it harder to verify that money isn’t being wasted. Another employee said unpaid contracts are now accruing interest, adding more costs.

“We are an oversight body,” the first employee told The Post. “We prevent waste and fraud and abuse, and if nobody is stopping it, it is going to go buck wild.”

In late January, amid a chaotic frenzy over a broader federal spending freeze, housing providers and others who run HUD-funded programs couldn’t access an agency portal and draw down crucial funds for more than a day. Since then, officials’ priorities are being fleshed out. Ben Hobbs, now a top official within the Office of Public and Indian Housing, mapped out his focuses in a Thursday staff meeting, according to multiple people in the room—including evicting undocumented residents of public housing. He also talked about implementing term limits or work requirements for most residents and cracking down on failing public housing authorities.

Scott Turner, a former football player who served in Trump’s first term as executive director of the White House Opportunity and Revitalization Council, was confirmed to run the department earlier this month. At his confirmation hearing, Turner said he would streamline regulations and that he planned “on looking at the team at HUD to see who and what we have and making sure that we have the best team in place to carry out the mission.”

He added: “I’ve been on a lot of teams in my life, and I’ve also been cut from teams, so I understand what that means.”

But Turner’s influence so far is unclear, staffers say. More direction has filtered down from Scott Langmack, a DOGE senior adviser to the housing department who previously worked as the chief operating officer of Kukun, an AI-powered property technology platform for homeowners and real estate investors, according to his LinkedIn profile. Employees said Langmack has expressed enthusiasm for using AI but has no broader housing expertise.

This month, HUD announced a new DOGE task force that will be composed of HUD employees, according to the department. Suggestions on how to maximize budgets will be relayed to Turner.

Employees have also been asked to flag ways to streamline operations to a new tip line, dogehud@hud.gov, according to an email sent by HUD’s Office of Public Affairs and obtained by The Post.

A recent DOGE post on X said that $1.9 billion in HUD money “was just recovered after being misplaced during the Biden administration due to a broken process.” The post said the funds were “earmarked for the administration of financial services, but were no longer needed.” Administration figures believe those funds should have been reported to the Treasury Department for other uses, instead of accumulating, according to department officials. Speaking at the Conservative Political Action Conference on Friday, Turner also said HUD has identified over $260 million in savings.

In a statement, HUD spokeswoman Kasey Lovett said the agency and Turner “will continue to deliver on its critical functions, mission to serve rural, tribal and urban communities and statutory responsibilities,” along with increasing access to affordable housing. In regard to FHA, Lovett pointed to a post on X from Turner saying HUD will prioritize “the critical role FHA plays in the mortgage market. The America dream of homeownership will be more attainable than ever” under Trump.

The pressure on HUD has already prompted a slew of key departures, including veteran officials who were among roughly 600 employees opting for the federal worker buyout program, according to the internal memo.

The department also had roughly 500 probationary staffers before last week. Not all were let go as the government shed new hires, though the firings were widespread, according to current staff. Some managers expected veterans and particularly high performers to be kept, but later learned many of those employees were fired, too. Looking ahead, one manager was asked to compile a list of people to spare from future cuts.

Career staff and housing experts hoped FHA would be mostly untouched. In addition to promoting affordability, FHA is deeply enmeshed in the technical financial instruments that undergird the U.S. mortgage markets. Any interference there, or the loss of the institutional know-how to keep it running, would send immediate shock waves through the mortgage market, experts say.

David Dworkin, president and chief executive of the centrist National Housing Conference, said the shake-up at HUD makes housing finance riskier for lenders. They depend on stability in the mortgage market and a kind of government assurance, either from FHA or Ginnie Mae, which oversees nearly $3 trillion in mortgage-backed securities and was also hit by widespread layoffs. Some lenders may withdraw from the market altogether, which would make it even harder for first-time buyers.

Dworkin also noted that all kinds of federal subsidies are crucial to helping build and maintain affordable housing units in ways that are still profitable for builders and owners.

“These are like train tracks the housing economy travels on,” Dworkin said. “Tearing up the tracks creates enormous risk. … Without the funds, those apartment buildings are not going to be built.”