Social Housing, Supported Housing and Specialist Supported Housing: What's the Difference?

I've been fortunate enough to work in social and supported housing for the best part of ten years, and some of our team have been doing this for forty years or more. That experience has given us the chance to deliver thousands of homes across social housing, supported housing and specialist supported housing.

These are three terms that get misused and misunderstood all the time, often treated as interchangeable when they're genuinely not. This article sets out what each one actually means and where the nuances lie.

A people-first investment

Before getting into the definitions, it's worth saying what stays consistent across all three categories: the motivation behind doing this work properly.

This has to be a people-first investment. It needs to be demand-led, providing good homes for people to live good lives, and that has to sit at the centre of what we do. Yes, we're fortunate that this generates a commercial return, but the more important outcome is the positive impact it delivers, for the tenants living in the properties, and in the form of a cost saving for the local authority and, ultimately, the taxpayer funding the system.

Social housing

Social housing is low cost rental accommodation for people who wouldn't be adequately served by the commercial rental market. Rents are typically below market value, controlled by the rent standard and the government's rent policy, which caps both the initial rent level and the rate at which it can increase each year.

This type of accommodation is typically provided by a local authority or a registered provider, and it normally comes with no support attached. It's simply the provision of housing.

Supported housing

Supported housing is housing plus support, for people who are at risk of or experiencing homelessness, as well as other groups such as those recovering from drug and alcohol dependency, young people leaving care, and survivors of domestic abuse. It's really an umbrella term rather than a strict legal classification.

Much of it is funded through housing benefit and known as exempt accommodation, meaning rent levels are exempt from the rent standard that applies to social housing. As a result, rents in supported housing can sometimes sit above the local housing allowance.

What matters most here, from our perspective, is that it has to provide demonstrably good value to the local authority. We define that as providing supported accommodation at a lower cost than the local authority would otherwise pay to secure something equivalent elsewhere.

With supported housing, there's typically no separately funded care package. Housing, along with any support or supervision, is delivered by a single provider, usually a registered provider of social housing or a not-for-profit voluntary organisation.

Specialist supported housing

Specialist supported housing is a defined funding classification set out by government, operating as a carve-out from the social rent rules. This is why rents in specialist supported housing can exceed those seen in the other two categories.

For a property to qualify, several conditions need to be met. It must have been specifically designed, redesigned, altered or developed to meet a particular need for the people who will live there, people who would otherwise be unable to live independently and would need to be in a care home or hospital setting instead. It must be provided by a registered provider under an agreement with the local authority and/or health department, with rent set in line with that agreement, and there must be no, or negligible, public financial support used to get the site up and running.

The structure here is different from the other two categories, because care and housing are funded separately and handled by different parties. Care is typically funded by the health department or social care, and paid to a separate care provider who looks after the tenants. Housing is managed by a registered provider of social housing, funded by the local authority through exempt housing benefit, who look after the property and the tenancy itself. The two parties work together through a service level agreement, or SLA.

Where Bailey Capital invests

At Bailey Capital, we invest across all three of these categories, because each one ticks our two boxes: positive impact and positive return.

If you're interested in investing in any of these sectors, feel free to reach out to one of the team. We'd love to talk you through how it works.