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The boundary between housing and social assistance policies has gradually faded in modern welfare state. A key feature of this transformation is the decrease of public housing supply, paired with a growth of demand side subsidies like means-tested housing allowances targeted to needy recipients, a kind of measures that closely resemble income support policies. The aim of the paper is to analyze reasons and impact of this shift towards social policies, considering the case of Fondo Sostegno Affitto (Rent Support Fund), a housing allowance introduced in Lombardy in early 2000s and deeply revised in 2012. The reassessment had two main features. The first one was a strong decrease of the eligibility threshold that left out many potential recipients, narrowing the target to the needy ones. In addition, the allowance amount became fixed and no more calibrated to housing need intensity like in previous years. This second transformation led also to an unequal distribution outcome, because the effectiveness of the fixed allowance is smaller for recipients with greater need of support like the ones who live in areas with higher rental fee.