Market‐based rentals are increasingly prioritized as the tenure type through which to provide housing assistance to low‐income households: it is argued that public housing places tenants in neighbourhoods with concentrated poverty, while the private sector is purported to offer households the opportunity to live in locations with less disadvantage. We test this assumption through a case study of a Nova Scotian municipality. Using chi‐square tests to examine associations between housing type and neighbourhood deprivation, we find that while 47% of public units are located in places with high social and economic deprivation, one‐third of market rentals are located in neighbourhoods with similar characteristics. In addition, in looking at the location of lower‐cost market units in particular, we find limited differences in the neighbourhood characteristics in which these more affordable rentals and public housing are found. We argue for the importance of connecting policy and programming to place‐based community development and poverty‐reduction strategies to support low‐income households.