After arrival, asylum seekers are often housed in reception centers. The type, quality and duration of stay in such centers varies considerably across or within countries. In the context of the so-called “EU refugee crisis” in 2014-2016, reports emerged that some asylum seekers and refugees remained in reception centers for several years due to limited capacity of municipalities, lengthy asylum procedures and tight housing markets. It is often argued that reception centers have a detrimental effect on integration processes of asylum seekers and refugees, yet empirical, inferential evidence is still lacking. This paper estimates the medium-run effect of duration of residence in reception centers on language skills, contacts to the host population, and employment status. We use high-quality panel data on asylum seekers and refugees living in Germany and apply inverse-probability-weighting (IPW). The results suggest that a comparatively quick transition from reception centers into private housing modestly increases interactions with the host population and their language proficiency. We find no effects on labor market participation. Furthermore, we find that moving into private housing is often associated with a shift to more precarious neighborhoods, potentially hindering a stronger realization of the benefits linked to independent living in general.