How do Section 8 income limits change from year to year?
Executive summary
HUD updates Section 8 income limits annually using American Community Survey (ACS) median family income as the base and applies a trend factor; for FY2025 HUD moved from a CPI trend to a per‑capita wage and salary change and capped increases at the greater of twice the change in national median income or 5%, with a 10% ceiling (effective April 1, 2025) [1] [2]. Income limits vary by area and family size and are recalculated each year, so local limits can rise, fall, or be capped depending on ACS data and HUD’s trend and cap rules [2] [1].
1. How HUD actually recalculates the limits each year — the method behind the headline
HUD starts with the most recent ACS median family income estimates for each metropolitan area and county, then “trends” that ACS value to the income‑limit year using a national trend factor rather than local inflation; for 2025 HUD replaced the Consumer Price Index trend with a trend based on the change in per‑capita wage and salary data [1] [2]. The HUD documentation and HUDUSER tables show that this process yields separate 30% (extremely low), 50% (very low) and 80% (low) income ceilings for each family size in each area [2] [3].
2. New for 2025: the trend factor and the cap that limit annual swings
Beginning with FY2025 HUD discontinued using CPI and began trending ACS medians with changes in per‑capita wage and salary; that change produced a larger inflation/trend factor in many areas (Novogradac’s example shows a change from ~1.046 to 1.0804 for a hypothetical $100,000 area median) [1]. HUD also applies a statutory cap on increases: the cap equals the greater of two times the change in national median income or 5%, but cannot exceed 10% — and for 2025 that cap was tied to the change from the 2022 to 2023 ACS [1].
3. What this means on the ground — local variability and family size matter
Because HUD starts with local ACS medians and then applies the national trend/cap, different metro areas and counties see very different dollar and percentage changes; limits are also scaled by household size so a family of four has a different cutoff than a single person [2] [3]. Practical publications (HUD PDFs and state/local housing authority tables) list the final FY2025 numbers by county/metro and household size — for example, Novoco’s FY2025 tables show county‑level MFI and the corresponding extremely low, very low and low limits [4] [2].
4. Frequency and timing — when you’ll see changes and who must use them
HUD publishes income limits annually (HUD has traditionally released them around April 1), and those new limits are effective for HUD programs (FY2025 limits were effective April 1, 2025) [2] [1]. Local public housing authorities and HUD‑assisted properties must use the updated limits for new admissions and initial certifications after the effective date, although available sources note that limits do not retroactively change the eligibility of residents already in place [3].
5. Size of changes and expectations — modest averages but outliers exist
Analysts estimated the average national change for 2025 could be modest (Novogradac’s estimator put an average near 3.2%, lower than 2024’s ~6%), but area‑level increases could be larger or smaller and some areas may be limited by the statutory cap; Novogradac also estimated fewer than 10% of areas would hit the cap, while HERA‑specific limits are not subject to the cap and may increase more [5] [1]. HUD’s own database lets users see exact percent and dollar changes by area [2].
6. What the limits control and ancillary rules you should know
Section 8 eligibility categories are defined in statute — “extremely low income” is the higher of the poverty guideline or 30% of area median, “very low” is 50% of AMI, and “low” is 80% of AMI — and those categories determine who may get vouchers or project‑based assistance; other program rules (like congressionally required shares of extremely low‑income admissions) remain in force [3] [6]. Different HUD programs (HOME, Section 8, LIHTC references) may use slightly different definitions or effective dates (HOME limits effective June 1, 2025, and Section 8 effective April 1, 2025), so check the specific program guidance [7] [2].
7. Where to look next — primary sources and local tables
For exact yearly changes and the local numbers, the HUDUSER Income Limits portal provides the official tables and documentation for each area and family size (official FY2025 tables are on HUDUSER and HUD’s PDF releases); Novogradac and local housing authorities also summarize the tables and explain methodological changes for practitioners [2] [1] [4]. If you need a single county or metro’s exact FY2025 limits, consult the HUDUSER dataset or the HUD PDF tables for that county/metro [2] [4].
Limitations: available sources explain the calculation method, caps, and 2025 methodological change but do not provide every technical formula step in this summary — for full methodological documentation and exact area‑by‑area changes consult HUD’s documentation system and the FY2025 tables [2] [4].