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Last year saw the 20th anniversary of the Wagner report Residential care: A positive choice. The report tried to shift the emphasis away from the view that residential care is the last resort and to value its role as a vital part of community care. However, over the last few years there has been a move away from residential care for people suffering from mental ill-health. The rationale for this shift has been the prevailing idea that it is better to treat people in their own homes. Although this is to a large extent driven by financial constraints on the part of health and social service commissioners, running parallel is the development of policy informed by ideas of normalization, anti-stigma and the increasing drive to empower service users, and diminish the authoritarian relationship that professionals have with them. While much of this is commendable, there has been very little serious thinking about the meaning of residence or dwelling in relation to care and treatment. This has resulted in the ensuing ideological shift often amounting to little more than a fashionable mantra. In this paper the author discusses the meaning of residence and its relation to care, with reference to the work of Lacan and Heidegger, in an attempt to re-situate the debate about the therapeutic potential of residential care at a more fundamental level.