Social housing rent rises to be capped lower than inflation for Mansfield tenants

The Government has run a consultation on increasing rent by a maximum of 5 per cent – less than half the current 10.1 per cent inflation rate – although increases of 3 and 7 per cent were also discussed.

The consultation results will impact the budgets of councils when setting rent for social housing.

Ministers set the ceiling for how much councils can raise rents. In usual years, fees would increase by the consumer price index, plus an additional 1 per cent.

However, if rent increased by the current 40-year-high inflation rate, tenants’ bills would rise by as much as 11.1 per cent from April.

But the consultation confirms rents will not rise that much, with some councils already budgeting for the 5 per cent cap.

Mansfield Council – the first Nottinghamshire authority to begin setting out budget papers – has reflected this in its 2023/24 planning.

Documents show this would bring an additional £874,000 into its Housing Revenue Account, with rental income of £26.489 million forecast.

Last year, a 4.1 per cent rental increase was approved by the council, alongside most other Nottinghamshire councils.

The average social rent was taken to £84.21 per week in Mansfield, with this year’s proposed 5 per cent increase potentially taking this up £4.21 to £88.42.

However, when approving last year’s rise, the council said many social housing tenants receive support through housing benefits or Universal Credit and would not feel the full effects of the increase.

Rents were discussed during the authority’s latest corporate resources scrutiny committee meeting.

Emma Frith, council financial services manager, said: “The budget is 5 per cent for rental increases for social housing tenants, because of a Department for Levelling Up, Housing and Communities consultation.

“The usual thing is rent would increase by CPI plus 1 per cent, but that at the minute is 10.1 per cent.

“Based on the consultation, there’s going to be a ceiling of 5 per cent. However, it did also seek views on ceilings of 3 and 7 per cent.”

Further details on council budgets are expected during Chancellor Jeremy Hunt’s upcoming autumn statement.