Glossary
Supported living
Homes leased to a care or housing provider for people who need support to live independently.
What it means
Supported living is housing for adults who need some support, such as people with learning disabilities, autism or mental health needs, where they hold their own tenancy and get care from a separate provider. Investors take part by leasing a suitable home, adapting it, and leasing it to a registered provider on a full repairing and insuring lease, usually for three to five years. The provider then manages the home, so there are few voids while the lease runs; the risk moves to the provider's covenant and to what happens when the lease ends. It is a rent-to-rent sub-type in Yieldhouse alongside serviced accommodation and HMOs.
Worked example
ExampleA worked example: a three-bed semi leased from the owner at £1,150 a month, adapted for £9,000 plus £1,500 of legal costs, and leased to a provider at £1,650 a month with 3% allowed for covenant risk.
- Rent received
- £1,650 × 12 × 97% = £19,206 a year
- Rent to the owner and costs you keep
- £13,800 + £600 = £14,400
- Profit
- £4,806 a year, about £400 a month
- Payback on £10,500 in
- about 26 months
The figures are illustrative, not what any provider pays. Agree the rent with the provider in writing, and check their registration and accounts.
Information, not advice. Example figures are fictional and for illustration only.