Supportive Housing & Market Rate Housing


General Model Description
In a Supportive Housing & Market Rate model, supportive housing units are set-aside within a larger private market development. This model maximizes integration of supportive housing tenants in the community, while also leveraging new and existing market housing stock. Mixed tenancy may occur through public financing or development incentives at the local level. Property management of the property is managed by the ownership entity or in agreement with a third party manager, depending on the housing type and the number of units. The owner and property management coordinates with one or more supportive service partners to design and deliver services to supportive housing tenants.

Download this section of the toolkit for all of the answers to the questions below.

Population Considerations 

  1. What are supportive housing populations?
  2. How is homelessness defined?
  3. How is a person with disability defined?
    As with homelessness, there are various conditions and documentation standards connected to the term “disability,” and how the criteria relates to funding sources or program. The American’s with Disabilities Act (ADA)provides a standard frame of reference for how to consider a the definition of a  a disability . First, there is the presence of the condition – either as documented or observed - coupled with the verification by an eligible health care provider that the condition impacts the person’s life.Second, is the impact of a disability on a person’s functioning. These two components work together in the following way:

    • Physical or mental impairment that "substantially limits" one or more "major life activities"; and
    • The impairment has been documented; or
    • The person is observed to have the impairment

    The types of impairments/disabilities can by physical or mental.

    Physical disabilities include: any medical condition, disfigurement or loss that impacts the body. Examples are blindness, cancer, diabetes, epilepsy, cerebral palsy, asthma, HIV/AIDS and its symptoms, renal failure, liver disease, etc.

    Mental impairments/disabilities include: any mental or psychological disorder. Examples include depression, schizophrenia, developmental and intellectual disabilities, organic brain syndrome (including traumatic brain injury), alcoholism, substance use disorder, etc.

    Sometimes conditions that constitute a disability for one program aren’t accepted by other programs.

    Take substance use disorder (SUD). In the case of the Social Security Administration (SSA), an addition to a substance is not itself considered a disabling condition. If there is a resulting physical or mental disability, that could be create eligibility for SSA benefits. [i] Whereas for HUD homeless programs, A disabling condition is defined as “a diagnosable substance abuse disorder, a serious mental illness, developmental disability, or chronic physical illness or disability, including the co-occurrence of two or more of these conditions.”[ii] Again, the entity responsible for compliance with funding sources will need to understand the range of disabilities allowed by program, and documentation standards.

  4. What is Olmstead and how does it have impact on supportive housing populations?
  5. How do project partners determine the demand for and market to specific supportive housing population needs in my community?
  6. What type of supports and services are needed for supportive housing populations to live independently in the community?


Ownership, Partnership, and Operations Key Considerations

  1. What are the benefits and challenges of combining market rate  and supportive housing units in a development?
    Integrating supportive housing units into a market rate housing development should be considered as one approach in which communities can create permanent housing options for supportive housing populations. As with all models, there are a number of benefits and challenges to consider before moving forward.Benefits of the Market Rate and Supportive Housing Mixed Affordability model include, but are not limited to:

    • The integration of tenants from various incomes and backgrounds. Many advocates of this model say that for supportive housing households to live among other non-disabled, working households can promote growth and the development of relationships that benefit all tenants. Similarly, non-disabled tenants can gain a better understanding of the disability community and reduce stigma when living in an inclusive community.
    • To create this model of housing, agencies serving supportive housing populations may partner with market rate housing developers/owners with each partner bringing their respective housing development and supportive service expertise. Having strong partners with a history and understanding of the housing development process, service delivery, and connection to the community can help alleviate community and neighborhood opposition and streamline the housing development process.
    • Similar to other models that include capital development, the owner maintains ownership and control of the units and provides greater longevity and commitment of units for supportive housing populations.
    • This model leverages the resources available for market rate housing development to assist and expand housing available for supportive housing populations.
    • Since this model generally involves either new construction or acquisition and rehabilitation, the development team has the ability to select property location, physical design, unit mix, and use of space to best meet the needs of the targeted tenants and promote integration with the community

    Challenges of this Supportive Housing and Market Rate model include, but are not limited to:

    • This model requires market rate owners to gain an understanding of the local need for supportive housing and specific target populations. To best understand the need for supportive housing and the target populations in a specific community, developers/owners should work with the local service provider community to analyze the need based on local homelessness data and characteristics of persons with disabilities. Additional information is available on this topic in the Population Consideration section.
    • While this model integrates a wide variety of tenant populations across affordable and supportive housing units, it can be very isolating for supportive housing tenants. To plan for and address isolation is one of the import roles of service provider(s). Also, regular check-ins between services providers and property management staff are important: as property managers tend to be the first to notice if a tenant hasn’t been seen or if a tenant has changes in their behavior.
    • This model, as with all supportive housing, adds another partner to the property team – the supportive service provider. In order to best reduce unit turnover, promote good tenant practices, and prevent eviction, coordination between property management and service provider is key.
    • In a market rate housing development that integrates supportive housing units, a supportive housing provider must gain an understanding of the standard screening criteria for the market rate property, and work with the property owner to adapt the overall policy that recognizes and plans for supportive housing tenants that may experience barriers to accessing housing. Often times, supportive housing tenants are determined to be ineligible from some rental housing, because of poor credit and rental history, criminal backgrounds, limited housing history, and more.  One of the challenges for this Mixed Affordability model within a market rate development is creating a screening process that screens all tenants consistently and ensures the safety of all tenants, but also ensures that supportive housing tenants are able to access the units.
    • While this model can effectively integrate a wide variety of tenant populations across market rate and supportive housing units, it can be very isolating for supportive housing tenants. To plan for and address isolation is one of the import roles of service provider(s).  Also, regular check-ins between services providers and property management staff are important: as property managers tend to be the first to notice if a tenant hasn’t been seen or if a tenant has changes in their behavior.
    • An owner must retain requisite property and liability insurance to cover all units both market and supportive housing.

  2. What are the different housing types that can be created under a Supportive Housing and Market Rate Model?
  3. What are the roles and responsibilities for key partners needed to successfully develop and operate a development that is this Supportive Housing and Market Rate Model?
  4. How can project partners ensure accountability to roles and responsibilities through the entire development timeline, including operations?
  5. Is there a ratio of market rate to supportive housing units that could impact the marketability of the non-supportive housing units? 
  6. What is master leasing and what partners are needed to create it?
  7. What are the best strategies to coordinate Property Management and Supportive Services delivery to promote housing stability of supportive housing tenants?


Integration Strategies Key Considerations

  1. What does community integration look like in this Supportive Housing and Market Rate Model?
  2. What are the best practices for managing community opposition to supportive housing?
    Supportive housing whether building on a single site location, integrating units with affordable or market rate units, or purchasing scattered site properties, often faces opposition from neighbors and community. Much of the opposition is built on unsubstantiated fears of safety or economic concerns. A proactive and collaborative strategy to obtain local government approvals (if required) and to address any community opposition for the development will include a number of clear components.

    • Ongoing dialogue with the community including participation in community improvement activities such as neighborhood association meetings and community policing discussions;
    • Build on expertise and relationships of team members to develop a comprehensive strategy, including a political strategy that identifies, key decision makers, allies and supporters;
    • Build a strong and broad community base, and prepare a public relations and media strategy;
    • Anticipate and address community concerns. Sometimes, providing testimony from neighbors and tenants of other supportive housing developments on how the developments impact their lives and what the everyday operations is like can help to address some of the worst fears;
    • Prepare a strategy to protect and use your legal rights, if the other components are unsuccessful.

    A common opposition message is that people from outside the community will be moving into the units. This is where local homelessness data and information about people exiting institutions can be very valuable. The key point is that the target population is already a part of the local community.

    Once operational it is important for the supportive housing development team to live up to promises made, make sure that units are maintained, and continue communications with neighbors and community organizations.

  3. How can development location and design impact community integration?
  4. How can the development implement a standard screening criteria and process across all units without creating barriers for supportive housing applicants?
  5. How can the project use preferences to target specific supportive housing populations?
  6. What are the best practices for navigating the application and understanding responsibilities of tenancy for persons with disabilities and/or language or literacy barriers?
  7. How do reasonable accommodation and modification practices contribute to community integration and how does it work?
  8. How do tenants living in a Supportive Housing and Market Rate Model connect with community resources?
  9. How can Supportive Housing and Market Rate Models maximize tenant involvement in the property to promote integration?


Supportive Services Considerations

  1. What types of services and supports are available to supportive housing tenants?
  2. What are the considerations in working with one primary service provider versus multiple service providers?
  3. What is included in the supportive services budget and how are services funded?
  4. Can non-supportive housing tenants in the development utilize services?
  5. What are strategies to provide services on and off site?
  6. How can service provider partners work with supportive housing tenants and property management to prevent evictions and keep unit turnover low
  7. What should an owner know about service delivery to supportive housing tenants?
    Property owners do not need to know everything about the delivery of supportive services to tenants. However, owners and supportive service partner(s) should ensure that there are shared goals and commitment to creating a safe and stable property for all tenants. A Memorandum of Understanding is the best place for partners to outline the overarching goals for the property and the roles and responsibilities. Additionally, the development of a supportive services plan is an important component for all supportive housing. The plan for providing supportive services to tenants should be designed to ensure that all members of the household have easy and facilitated access to a flexible and comprehensive array of supportive services.When creating the service plan for your project or evaluating the quality of an existing one, keep in mind the basic WHO, WHAT, WHEN, WHERE and WHY.WHO – As with all aspects of supportive housing planning and operations, the needs and characteristics of prospective supportive housing tenants should drive the design of the services plan. Ask yourself the following questions:
  • Who is the targeted tenancy?
  • Why was this target population/mix selected?
  • Do the owner, funding source(s) and community agree on the proposed tenant mix?
  • What supports do you anticipate that the tenants will need at initial occupancy? In three years?
  • How will the service provider(s) respond to changes in the population over time, particularly for tenants with substance use issues, mental health challenges and/or HIV/AIDS?WHAT – Based on information about the target population and their anticipated service needs, you will want to identify the specific services that offered to tenants. The lead service provider can offer the services themselves or in partnership with one or more community-based service organizations. In addition to identifying the specific services such as case management, employment support, mental health services, substance abuse counseling, life skills education and parenting classes, you also will want to consider:
  • Are the types and level of supportive services to be provided adequate for the population served?
  • Will each service be available to all of the tenants?
  • When will working tenants have access to services?
  • Are language and literacy barriers addressed?
  • How will staff address the varying backgrounds and cultures of tenants?
  • How many tenants do you expect to use each service? With what frequency?
  • What is the staff/tenant ratio? How does this ratio compare to similar supportive housing projects?WHERE – It is not enough to have a service available to tenants, the service must be offered at a time and location that increases the likelihood that tenants will use it. See response to Question 5 above for different service delivery models.WHEN – The initial plan for supportive services is created during the project-planning phase, but should be revisited throughout the life of the project, as tenants’ needs change. You will want to create a timeline for drafting the services plan, reviewing it and revising it with key partners and beginning its implementation as tenants move in.WHY – It is important to be clear about the purpose behind the provision of supportive services to tenants as well as the underlying philosophies of the organizations that will be providing the services. You may want to consider:
  • How do the services support tenants in using stable housing as a platform for health, recovery and individual growth?
  • How will participation in voluntary services be encouraged? Has staff received the support they need to engage tenants in this service model?
  • How will tenants be involved in providing input into the services plan for the project, both initially and on an ongoing basis?
  • Will tenants be involved in evaluating the effectiveness of the services provided? If so, how?

Financing Considerations

  1. What capital resources are available to develop Supportive Housing and Market Rate Housing Model?
  2. How is the operating budget impacted if a market rate development includes supportive housing units?
  3. What is rental assistance and how does it work?
    Rental assistance or rental subsidies are provided by government to partially pay for the monthly rent on a housing unit for an eligible household that cannot afford to pay the full rent. These subsidies will pay the property owner a portion of the fair market rental rate on the property. The tenant is responsible for paying rent up to 30% of their income. While income eligibility for rental assistance may vary across programs, generally the maximum income for a household is set at or below 50% of the median income, and for many programs, at or below 30% of the area median income.The two primary types of rental assistance are ‘project based’ – where the rental assistance is assigned to a specific housing unit or property, and ‘tenant based voucher’ – where the assistance is assigned to a qualified resident and can be used to pay rent in any qualifying rental unit. A third type of rental assistance is ‘sponsor based’ where a non-profit service provider may receive funding for rental assistance to allocate the assistance to housing units for targeted supportive housing populations.Public Housing Authorities (PHA) or other rental assistance administrator will have key roles in the administration of rental assistance programs in most communities. The commitment for rental assistance to a property is structured based on two parallel legal agreements. The property owner enters into a lease directly with the tenant, and s into a rental assistance agreement or housing assistance contract with the government entity or organization, often the public housing authority, responsible for paying the rental assistance. The term of this rental assistance agreement is established for at least one year, and can be renewed annually subject to qualification of the housing unit and funding availability. In order to qualify for rental assistance, the owners of housing units must bring the properties to meet ‘housing quality standards’, commit to completing necessary reporting, and conform to all fair housing requirements. Under the project based rental assistance program, the time commitment for assistance can be one, five or up to 15 years. Typically, the standard for a capital investor to underwrite a project relying on rental assistance is to have a rental assistance contract (project based or sponsor based) that is at least five-years or longer.
  4. What are the available funding sources for rental assistance to create supportive housing?
  5. How can rental assistance be used in a Supportive Housing and Market Rate Model?



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