Social care inspector Louise Whittle visited Upper Pendeford Farm, which provides short breaks for up to six young people at a time, last month.
She found that young people "love coming for their short breaks" at the City of Wolverhampton Council run centre, and have "warm relationships with staff".
They and their families "value their short breaks", which help the young people improve their self confidence, education and social development and better manage their emotions and behaviour. One family member praised the support on offer, saying: "I couldn't fault the service; they understand his problems, they did a lot of work with him and he has responded".
Since the last inspection, registered manager Phillip Johnson has introduced a number of innovations "which have improved the effectiveness of the service" further.
Staff have taken on new roles which are giving children and young people more opportunities to express their views and shape activities, while healthier meals are also now on offer.
The already highly trained staff are benefitting from additional training and demonstrate "in depth knowledge of young people and the reasons they are on the edge of care".
Upper Pendeford Farm was previously judged Good in August 2017 and following last month's interim inspection, Ofsted concluded that it "has improved effectiveness".
Emma Bennett, the City of Wolverhampton Council's Director for Children's Services, said: "This is a very positive report which demonstrates the continuing improvements to the service provided by Upper Pendeford Farm thanks to the hard work and dedication of Phillip Johnson and his team.
"The respite centre provides a home away from home for children and young people with emotional or behavioural difficulties and I am pleased that not only Ofsted, but also the young people and their families, speak so highly of the important support it provides."
- released: Wednesday 4 April, 2018