New analysis of Ofsted data finds capacity is growing more slowly than the number of homes, private provision has risen 22.9%, and more than half of children's home operators run just one home.
14 August 2026, England - The number of registered children's homes in England increased by more than a fifth in just one year, according to new analysis of Ofsted provider data by Arc Research.
England had 4,394 registered children's homes at 30 September 2025, 747 more than a year earlier and an increase of 20.5%.
However, the number of registered places grew more slowly, increasing 14.7% from 13,438 to 15,416. As a result, average registered capacity fell from 3.68 places per home to 3.51.
The analysis suggests that the rapid expansion of children's residential care is being driven by the addition of large numbers of relatively small homes rather than equivalent growth in registered capacity.
Nearly 57% of England's children's homes now have three registered places or fewer, while only 232 homes have capacity for seven or more children.
PRIVATE PROVISION IS GROWING FASTEST, BUT OWNERSHIP REMAINS FRAGMENTED
Private providers now operate 3,730 of England's 4,394 registered children's homes.
Private provision increased 22.9% year on year, compared with growth of 9.6% among local-authority homes and 7.8% in the voluntary sector.
Despite the scale of private provision, ownership is highly fragmented. Arc Research identified 1,526 distinct owning organisations, of which 793, or 52%, operate exactly one children's home.
The ten largest owning organisations collectively account for only 12.6% of registered homes, while the largest individual operator accounts for 4.1%.
Sam Benson, Research Lead at Arc Research, said:
"England doesn't have a simple shortage of children's homes. The number of registered homes has risen by more than 20% in a single year, yet capacity hasn't kept pace.
"What we're seeing is a sector adding large numbers of increasingly small homes, overwhelmingly through private provision, while that growth remains heavily concentrated in particular parts of the country.
"That raises a more important question than simply how many homes England has: whether we're creating the right provision, at the right scale, in the places where children actually need it."
The Ofsted provider data does not show where demand for placements originates or whether individual homes meet local or national placement needs. Arc Research therefore does not conclude from this analysis that provision is being created in the wrong locations. Instead, the findings highlight the need to consider capacity and geographical distribution alongside headline growth in the number of registered homes.
ONE IN FOUR CHILDREN'S HOMES IS IN THE NORTH WEST
The research identifies substantial geographical differences in the distribution and growth of provision.
The North West has 1,149 registered children's homes, representing 26.1% of the national total. That is more than the South East, South West, London and North East combined.
Lancashire alone has 376 registered homes, up from 292 a year earlier, an increase of 84.
Every English region recorded growth, although the rate varied considerably. The East Midlands saw the fastest increase at 30.0%, followed by London at 29.2%, East of England at 23.2% and the North West at 23.0%.
At parliamentary constituency level, Fylde has 66 registered children's homes and 149 registered places, the highest number of homes of any constituency in England.
MOST INSPECTED HOMES ARE RATED GOOD OR OUTSTANDING
Of the 3,913 children's homes carrying an Ofsted inspection judgement at the snapshot date, 87.4% were rated Good or Outstanding.
A total of 91 homes, or 2.3% of graded homes, were rated Inadequate. Another 481 registered homes had not yet received an inspection judgement.
The proportion rated Inadequate was highest in the North East at 3.8%, followed by Yorkshire and the Humber at 3.7% and the North West at 3.6%.
Arc Research cautions against drawing causal conclusions from the regional inspection differences. The number of Inadequate homes is small in several regions, and the Ofsted dataset cannot establish whether differences reflect provision quality, inspection schedules, the age of provision or other characteristics of regional markets.
ABOUT THE RESEARCH
England's Children's Homes: Ofsted Provider Data 2025 analyses Ofsted's Inspection and regulation of children's social care and supported accommodation providers dataset, released on 30 January 2026 and covering registered provision at 30 September 2025.
Year-on-year comparisons use the equivalent Ofsted dataset covering 30 September 2024.
The analysis covers registered children's homes only. It excludes secure children's homes, residential special schools registered as children's homes, supported accommodation, fostering agencies and other provision types contained within the wider Ofsted dataset.
The figures represent registration positions at a point in time. They do not show the total number of homes that opened or closed during the year.
Read the full report, methodology and data analysis.
ABOUT ARC RESEARCH
Arc Research publishes data and analysis on children's residential care in England. It uses publicly available datasets and original research to examine how the structure and provision of residential care is changing.
Arc Research is published by Arc, a software platform built for children's residential care providers.
MEDIA CONTACT
Sam Benson
Research Lead, Arc Research
press@arccare.co.uk
Arc Research
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