An estimated 250,000 to 300,000 people use recovery housing every year, and most residents have previously experienced homelessness, according to a report published by the Manhattan Institute in October 2026. The report examines recovery housing—intermediate-length residential programs for people recovering from drug or alcohol addiction—as a potential solution to the nation's homelessness crisis. Author Stephen Eide argues that expanding these sobriety-focused programs could help rebalance a homelessness services system that has become heavily weighted toward permanent supportive housing.
The number of recovery housing programs nationwide is estimated between 10,000 and 18,000, according to the report, though calculating the precise total remains difficult. Oxford Houses, the oldest peer-run model, have nearly tripled since 2010, growing from 1,450 to 4,029 units. A 2025 survey of 420 programs found that 73% reported serving mostly individuals with a history of homelessness. Oxford House reports that nearly 75% of its residents were formerly homeless, had been homeless three times on average, and experienced their longest stretch of homelessness lasting about a year. In Ohio, roughly 20% of recovery housing residents had been homeless during the month before moving in, while Recovery Kentucky reports that about one-third of residents are "currently homeless" at intake. The programs charge an average rent of $692, and resident fees remain the largest revenue source, though public funding has expanded significantly in recent years through HUD's Recovery Housing Program, opioid settlement funds, and state-administered federal grants.
The report finds that addiction causes homelessness and keeps people homeless, with some targeted surveys showing substance abuse disorder rates of 70% to 80% among the unsheltered population. According to Eide, "recovery housing provides a means of sustaining sobriety in a cost-effective way that minimizes overmedicalization." The average stay in long-term residential treatment is just 66 days, but relapse remains highly likely after only a few months of sobriety, and the longer someone maintains sobriety, the likelier permanent recovery becomes. The report states that recovery housing helps residents extend their sobriety by building "recovery capital"—the social supports and resources that someone fresh out of treatment can accumulate and later draw on when facing triggers for relapse. Shared housing promotes recovery by encouraging the formation of these social supports among residents, making the setting itself the service.
Eide explains that over the past two decades, federal homelessness policy shifted dramatically toward Housing First, a harm-reduction philosophy that moved people rapidly from streets into permanent housing without requiring sobriety or service participation. The report notes that transitional housing—intermediate-length programs requiring sobriety—saw funding drop from about one-third of federal homelessness grants in the late 2000s to just 1% in 2024, while permanent supportive housing now receives over 80% of funding even though only 30% of the homeless population is considered chronically homeless. This shift coincided with homelessness reaching historic highs, rising from about 640,000 in the late 2000s to 750,000 in 2026. The Trump administration has called for restoring balance by redirecting funds toward sobriety-oriented programs, releasing a 2026 funding notice that sets aside $1.3 billion for new transitional and non-permanent housing programs after legal challenges to earlier reform attempts.
The report recommends that state governments, which already make the most important decisions about recovery housing quality, should expand certification for recovery houses and create exceptions in eviction law for certified programs. Currently, about one-third of states have no official definition of recovery housing, and thousands of programs remain uncertified. Eide argues that federal homeless authorities should proceed carefully when integrating recovery housing into homelessness services systems, using funding as leverage to strengthen quality rather than simply expanding raw unit numbers. The report concludes that while integration could help balance a system tilted too heavily toward Housing First, safeguards are essential to preserve recovery housing's integrity and ensure that certified programs can quickly remove residents who return to substance use—a power critical to protecting the recovery environment for other residents.