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We are increasing our rent charges from April 1 this year – the first time they have risen in four years.
This isn’t a decision we’ve made lightly. But it is essential if we are to implement our ambitious plans to boost tenant services, improve existing properties and build new homes.
First and foremost, we are committed to making sure the rent tenants pay remains affordable now and into the future.
Before making this decision, we carried out research into the impact of rent increases to make sure they are affordable for tenants.
From April 1, a change in Government policy allows us to increase rents after four years when charges reduced.
We will increase rents by 2.7% in 2020-21.
This means the average weekly rent will rise from £75.68 in 2019-20 to £77.70.
The new Government policy allows rents to increase by the Consumer Price Index (CPI) + 1% at September 2019 – this is a national measure calculated by taking price changes for certain goods and services and averaging them.
CPI was 1.7% which means rents can be increased by a maximum of 2.7%.
We compared our rents to those charged across the region in the private and social sectors and assessed whether our rents resulted in people spending more than 33% of their income on rent. This is an Affordable Housing Commission indicator of affordability.
The results of the research show that our rents are below market levels, compare favourably to other North East housing associations and are below the 33% Affordable Housing Commission ratio of rent to income.
With this robust evidence we are assured our rents will remain affordable for tenants with an increase of 2.7%.
Greater rental income will underpin our ambitious plans to invest in homes and services: Next year we will spend:
Our rents remain fully eligible for housing benefit and the housing cost element of Universal Credit.
In the next few weeks, you will receive your formal rent increase notification which will set out your new rent and any charges from April 2020.
Please read this carefully and make sure you inform any other organisations that need to know about the changes.