The Social Housing Rent Cap Consultation

The Department for Levelling Up, Housing and Communities has recently launched a consultation to invite views from social housing residents and landlords on a proposed rent cap. The outcome of this consultation will determine the level of the increase which will apply to social housing rents from April 2023.

Why is this consultation taking place?

Social Housing Rents are regulated by the Government. This means that Elim, as a registered provider, is bound by a national rent setting policy. Over recent years, rent increases have been set in line with the Consumer Price Index (CPI) rate, plus one per cent (CPI+1).

As a result of the current level of inflation, recent Bank of England forecasts suggest that by next April the CPI+1 rent setting policy could lead to a potential rent increase of 11.1% or more.

The Government is concerned about the impact of this rent increase on the most vulnerable households and has launched this consultation as part of their response to the Cost of Living Crisis. The consultation is seeking feedback from landlords and residents on the impact of four options, including rent caps at 3%, 5% or 7% cap, or no change at all.

Our CEO, Paul Smith said:

“We agree with the government’s decision to launch this consultation. We are very concerned about the impact of the cost of living crisis on our residents, and would like to see additional support made available so that families are not pushed into poverty.
As a charitable landlord, it is also important that we recognise the impact that the potential rent cap will have on Elim. There is a careful balance to be found to ensure protection for our residents, and sufficient income to invest in homes and services.
Our Board will be reviewing our response to the consultation over the next fortnight, but we are in agreement that rents should be capped below the current inflation linked policy in these exceptional economic circumstances.”

This consultation excludes any proposal to cap the rents for Shared Ownership properties or Mobile Homes for the 2023 – 204 year. Elim recognise that affordability is an issue for all our customers, and we will therefore recommend that caps are also applied to shared ownership rents and rents for the pitches on Gypsy and Traveller Site we own.

The consultation will close on 12th October 2022, and we would encourage you to provide your views on this matter.

You can respond to the consultation here