HUD Layoffs Caused Delays and Confusion in Housing Programs, Independent Report Finds

The U.S. Department of Housing and Urban Development shed almost 30% of its staff, efficiency measures that have made it more difficult to navigate, according to a new report.

A report from the Government Accountability Office shows HUD reduced its headcount by 29% from December 2024 to December 2025, mostly through deferred resignation programs. But many of those who left were among its most experienced people, and many agencies that work with HUD say it's become harder to work with.

The cuts come as the Trump administration shifted HUD's focus to new strategies to fight homelessness, as well as stopping fraud from housing agencies. In May testimony before a House appropriations committee, HUD Secretary Scott Turner emphasized efficiency.

"Taxpayer dollars are finite but our responsibility is not," Turner said. HUD's downsizing effort "reins in wasteful spending and stops the ballooning of federal welfare programs," he said. In the meantime, he said some of those programs lost focus.

Democrats quickly criticized the Trump administration following the report.

Sen. Elizabeth Warren (D-MA) said the cuts have meant cuts to housing programs that would improve affordability. Warren requested information from HUD alleging "troubling failure to enforce fair housing and civil rights laws."

"Trump’s draconian cuts mean that more Americans have fallen behind on rent, housing quality is getting worse, and enforcement against housing discrimination is all but eliminated," Warren said in a statement. "Secretary Scott Turner and his department must immediately reverse course.”

It's the latest in a broader efficiency focus in the federal government. Earlier this month, the Federal Housing Administration also announced cuts at its Inspector General's office. That office, which has some oversight over FHA's administration of Fannie Mae and Freddie Mac, also engendered criticism from Democrats.

Experience in cuts

The OIG report details how the federal workforce changed as HUD immediately eyed staffing cuts when Trump came into office in January 2025. Late last year, 442 HUD staffers received layoff notices as part of a broader purge of more than 4,100 federal workers across multiple agencies.

HUD's headcount dropped from 8,842 in December 2024 to 6,299 in December 2025. Over half of those who left had at least 10 years of service, and about 41% of them had over 20 years of service.

With those job cuts came changes in the type of programs that HUD funds. HUD terminated 21% of its active contracts in 2025, amounting to about $367 million, most involving professional or IT services.

HUD in the meantime has reoriented to what Turner says is a more focused organization. Some of those decisions have been controversial, including pursuing large businesses for their diversity, equity, and inclusion programs and shifting funds for Fair Housing enforcement.

In the meantime, the OIG interviewed 20 stakeholder organizations, including fair housing recipients, public housing agencies, and Section 8 property managers. They reported confusion, delays, and disruptions. Many of them reported that it's become harder to navigate programs because their points of contact left.

But those stakeholders also reported service and staffing delays, particularly during government shutdowns. And they also reported delays with inspections of HUD properties. HUD didn't respond to GAO as it sought to discuss the efficiency initiatives it has since launched.

"As a result, Congress and the public have limited information on the status or effectiveness of these initiatives," the GAO said.

Implications for housing reform

In a statement, HUD defended the changes, arguing it "has restored its commitment to efficiency and stewardship." It cited ongoing efforts to clear the backlog of civil rights and fair housing cases.

"While the Biden administration turned a blind eye to this massive amount of waste and abuse, we are standing up for the American people’s hard-earned tax dollars, so every cent serves our most vulnerable instead of lining the pockets of homeless industrial complex millionaires," it said.

HUD's staffing cuts come as Congress passed one of the most comprehensive housing reform packages in decades this spring in the 21st Century Road to Housing Act. It has dozens of provisions to enact, with the majority of the work falling on HUD's shoulders.

In a webinar last month hosted by the Bipartisan Policy Center, experts worried this could mean delays in enacting some housing programs.

Aaron Shroyer, director of policy and advocacy at the National Association of Affordable Housing Lenders, estimated there are at least 125 implementation items in the bill. About 70% of them fall on HUD, and some of them will take years of work.

"In certain circumstances, like some of the zoning guidebooks and the like, is new work for HUD," Shroyer said. "So it's important that they have the staff with the know-how to get out the rules in a timely manner."