Council rents to increase by 7% in April

Stock image (credit: Pixabay)

The increase means council tenants will pay an average of £30 more per month

By Josh Mellor, Local Democracy Reporter

Waltham Forest Council tenants are set to pay 7% more in rent from next April.

The rent increase will mean the council’s 10,000 council tenants will pay an average of £30 more per month.

The 7% increase is also likely to hit the 15,000 social rent homes managed by housing associations in the borough.

Since 2019, social housing landlords such as Waltham Forest have been allowed to increase rents in line with the rate of inflation, plus one percent.

Last year, this rule led to an increase of 4.1%, more than double the 1.5% increase in 2020/21.

However, the high rate of inflation this year meant that, until the government capped social rents in its autumn statement, council tenants could have faced a maximum increase of 11.1%.

According to a council report due to be approved by cabinet in February, increasing rents at a lower rate than inflation creates an “extremely challenging” outlook for the council’s housing account.

The housing account is ringfenced from other spending and is used for all housing-related income and spending, including housebuilding.

The report, prepared by strategic financial advisor for housing Julie Curtis, says her department will focus on maintaining existing housing stock and “compliance with health and safety regulations”.

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Capping the cost of council housing rents could cut its ability to borrow by £4.6m in 2023/24, meaning Waltham Forest may have to “scale back” its council housing improvement and housebuilding plans.

The report suggests that public consultation on rent increases was only carried out via a council panel known as the strategic tenants and residents (STAR) panel.

However, minutes of the panel’s most recent meeting, in October last year, suggest that none of STAR’s five members provided any feedback following a presentation on the increases.

Electricity and heating cost increases are also likely to be passed on to tenants and leaseholders, although not initially at market rates.

These two service charges are likely to see a “phased increase” starting next year and continuing in following years, with a 7% rise in heating charges and £6 more per month for electricity.

The report also shows that social housing rents and London affordable rents are significantly lower than the private market.

From April, a two-bed council home is likely to cost £468 per month, while two-bed homes on the private market would average £1,800 per month.

This difference is even higher for council homes with three bedrooms, which cost about £540 per month, or four bedrooms at £632 per month.

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