What DHA’s HAP Freeze Means for Investors (And Why We’re Still Bullish on Dallas)
It started with a four-bedroom voucher holder touring one of our available homes. On paper, she was a great candidate—solid rental history, clear communication, and interest in moving quickly. But when we submitted her paperwork to the Dallas Housing Authority (DHA), something didn’t add up: her Housing Assistance Payment (HAP) portion came back far lower than expected.
That’s when we learned firsthand about a quiet but important shift in DHA policy—one that could impact investor leasing strategies across Dallas for the rest of 2025.
What’s Happening with DHA?
In early May, DHA sent an email to its landlord partners warning of a projected funding shortfall for 2025. According to HUD data, DHA has seen the highest 5-year increase in per-unit costs (PUC) in Texas and ranks third nationwide among large metro housing authorities, with an average PUC of $1,635—higher even than NYC. As a result, DHA is freezing the HAP portion of rent for voluntary tenant moves.
Here’s what that really means:
If a tenant chooses to move voluntarily, the amount DHA will pay (the HAP portion) is capped at the level it was as of May 2, 2025. This does not apply to involuntary moves (e.g., if the landlord sells or a property becomes uninhabitable), new applicants porting into the system, or tenants already housed in high-opportunity areas.
DHA is also discouraging tenants from relocating, and while they’re asking landlords to hold off on rent increase requests, they’ll still review and approve them if submitted. In short: the program hasn’t stopped, but it is treading carefully for the remainder of the fiscal year.
Why This Matters to Investors
The biggest impact is on tenant pool size. With HAP amounts frozen for voluntary movers, the pool of eligible voucher holders who can afford higher rents in high-opportunity areas has temporarily shrunk. In practical terms, that means some of the properties we buy and manage—especially in better zip codes—may experience slightly longer lease-up times, or lower voucher payments than anticipated.
This likely explains the pockets of vacancy we’re seeing in areas like Forney. These markets traditionally relied on growth and upward movement of voucher values, and the freeze puts a pause on that trajectory.
So Why Are We Still Bullish on Dallas?
First, this isn’t our first bump in the road. Housing Authorities across the country go through cycles of funding pressure, and DHA is actively managing this one. They’ve already submitted for additional funding, and history tells us that Congress rarely lets Housing Choice Voucher programs falter—especially not in an election year. The program is bipartisan, deeply embedded in North Texas housing policy, and has strong institutional momentum.
Second, it’s still a buyer’s market. Inventory in May 2025 was the highest we’ve seen in over a year for homes priced under $400K. Median Days on Market rose year over year, and sale prices closed further below their original list price compared to 2024. Translation: you can negotiate better deals, especially on homes in zip codes where Section 8 still pays well—and model for regular market rents as a fallback.
Third, this isn’t permanent. When the HAP freeze lifts (hopefully in 2026), rent resets and increase requests will be back on the table. That means today’s purchase could have tomorrow’s upside built in.
What We’re Advising Clients
We’re encouraging SolMidas investors to continue modeling deals assuming discounted payment standard rents. If the math still works, great. And if/when DHA funding increases, that becomes bonus cash flow.
We’re also screening tenant pools carefully to identify:
Involuntary movers (who are not impacted by the freeze)
Voucher holders currently living in high-opportunity areas
New DHA participants porting in from other jurisdictions
It’s a more nuanced leasing environment, but it’s still one with opportunity—especially for investors willing to play the long game.
Final Word
If you’re investing in Dallas real estate, this update isn’t a red light—it’s a yellow one. Move forward, but with extra diligence. The fundamentals remain strong, the demand is still real, and the Dallas Housing Authority is working to bridge the gap.
This is the kind of market moment that rewards thoughtful investors—and the kind of insight we aim to deliver at SolMidas.
Have questions or want help evaluating your next deal? Let’s talk.