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Resources for Starting a Halfway House or Transitional Housing Facility

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Resources for Starting a Halfway House or Transitional Housing Facility

By NicoleD
Published: July 9, 2010 Updated: September 24, 2014

Are you thinking about starting a halfway house or transitional housing facility? Read on for a brief overview of the steps to take to start your own temporary housing service.


What Is Transitional Housing?
Transitional housing provides people with a temporary place to live as they attempt to get back on their feet or make a major transition in their lives.


How Do I Start a Transitional Home?
Like any business, when you choose to start a transitional housing facility, you will need thoroughly research your idea and create a solid business plan that addresses the legal and financial needs of the business.


Do Your Research.
Assess your target audience and the services needed in your area. Popular resident audiences for transitional housing include former federal or local inmates, young mothers, at-risk teens, veterans, the homeless, people with disabilities, and substance abusers. If you are unsure about the needs in your community, your local social services department may be able to provide insight.

Learn about the specific population you plan to assist, including average age, the services they currently receive, and where they currently receive them. Some transitional housing facilities only offer housing, while others provide additional services like job support, counseling, and medical care.

In addition to identifying your resident audience, your business plan includes your busines;s mission, goals, operations plan and projected financials. Learn how to create a business plan at Business.gov.

Identify a Location.
Once you determine your audience, begin to research potential locations for the housing facility. Do you plan to lease or own the building? Will you need to build a new structure, or is there an existing facility that you have in mind? If you have your eye on an existing facility, will you need to renovate it?

The US Department of Health and Human Services (HHS) highlights key questions that you should ask yourself when determining which housing model is best for you and your residents, and offers the following advice - no matter the type of housing or lease you choose, aim for residences near the following:

  • Public transportation, if available in your community
  • Potential places of employment
  • High schools and community colleges
  • Health care clinics and hospitals

Once you identify an ideal location, familiarize yourself with the housing regulations and zoning laws in the area.


Register Your Business and Get Licenses.
Typically, transitional housing facilities are registered as non profit organizations, enabling eligibility for certain benefits including grants, government surplus, and tax exemptions. A non profit organization (NPO) is a business entity where making a profit is not a primary mission. Read more about programs and services that benefit non profits.


You must obtain relevant business licenses and permits like any other business. Regulations vary by industry, state and locality. Follow these steps to establish a non profit organization.


Assess Your Business Needs and Establish Guidelines.

Determine how many residents your facility can hold, keeping legal, funding, and safety restrictions in mind. The following resources provide examples of standard agreements regarding safety and resident rights: Northeast Ohio Coalition for the Homeles-s safety standards; Californi-s Department of Social Services transitional housing guidelines; and the District of Columbi's Standards for Transitional Housing.


Think about the staff you will need to keep your operations running. The Corporation for Supportive Housing (CSH) * advises that most supportive housing projects will need to assemble a'development team, a group of professional consultants, service vendors and other non profit organizations that collectively bring all of the skills, expertise, knowledge and experience to bear on the development and operation of the project' Non profit facilities will need to establish a board of directors and governing bylaws. This CSH toolkit offers advice for setting up your staffing team.


Also consider the supplies and equipment you will need to not only run the business, but also to furnish the facility. If you receive donated goods, remember that IRS.gov provides guidance on the federal tax requirements for donated property.


Consider your operating costs and determine how much rent, if any, you are going to charge residents.

Finance Your Business

Typically, non profits receive most of their fundraising donations from businesses, individuals, and faith-based groups. For a brief overview on how to fundraise, see this Business.gov article'Going Beyond the Shot Gun Approach' 5 Tips for Optimizing Your Non-Profi's Fundraising Efforts

Your transitional housing facility can also receive financial assistance from the government. The Federal government provides grants, loans and programs to fund non profit projects. For example, the Department of Justic's Transitional Housing Assistance Program targets programs that assist victims of domestic and relationship violence, stalking, or sexual assault, while the Supportive Housing Program (SHP) grants from the Department of Housing and Urban Development benefit transitional housing for the homeless, and the Department of Veteran Affairs sets aside annual funding to community agencies and non profits that provide housing or supportive services for homeless Veterans.

Many state and local governments also provide financial assistance. Check with your local social services or family welfare offices for information on the programs in your area.


Foster Community Ties.

Know going into the process that it is common for a transitional housing facility to face opposition from potential neighbors. Talk with residents, local officials, and other business owners in the community about where you plan to operate, and solicit their support by explaining how your housing plan will benefit the community. For example, if your target audience is at-risk teens, you can explain how a transitional housing facility will provide a steady environment to combat homelessness, vandalism, and loitering.

Once you begin to gain traction in your community, begin to assemble a team of experts, including your local social services department, a realtor, and a lawyer, to help you move forward with your plans.


Do You Need More Assistance?

The Corporation for Supportive Housing's Toolkit for Developing and Operating Supportive Housing* is a helpful resource that includes guides on securing financing, building your team, assessing capacity, securing the project site, and reaching out to your community.


While this resource guide from the Department of Health and Human Services focuses on a homeless youth demographic, its theories are useful for any transitional housing operation.


Are you starting a transitional home or halfway house? Ask questions and share advice with other business owners in the Community.



About the Author:


Looking for a sample letter to State Representative asking for help in supporting a sober house in MA.
This article has been very helpful for me, and has given great insight. I have clarity of the best direction to take for my needs. I am clear as to what I need to do and how to do it.
I am looking to start a Transitional home in Michigan. Does anybody have any helpful tips their willing to share?
Trying to find available grants for a transitional home for inmate still under house arrest while serving their time. Any help?
We are interested in starting a transitional living facility for adults, behavioral health in Central OR. Is SBA funding available for private pay facilities? What resources are available to determine need and do a business model? Thank you
I would like to know the answer to sparkles 9009 question. I see the questions but can't see how to read the answers
Please assist me with the opening of a halfway house for inmate transitioning from prison. Where do I start!
my email is (Edited to remove email address by SBA.gov moderator). If anyone have any information how I can get help with the process. I would like to start a transitional house for parents of children that are prison /or been released. in the Pinellas county area.
I would like to start a transitional house for parents of children that are prison /or been released. in the Pinellas county area.
I can be reached at (Edited to remove email address by SBA.gov moderator)


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