The minister highlighted how this will also give greater stability for landlords, as they will be able to use this certainty to predict their likely revenues and invest in new homes.
A fair deal for tenants and landlords
Yesterday’s (31 October 2013) proposals would come into effect from April 2015, and offers a fair deal for tenants and landlords alike.
For tenants, annual rent increases will be linked to inflation - using the more stable Consumer Price Index as a measure rather than the Retail Price Index as has been used in previous years.
In turn, it will give councils and housing associations the stability they need to plan investment in new homes in their area, supporting £23 billion public and private investment in affordable homes planned from 2015.
This will also help towards achieving the fastest rate of affordable housebuilding for 2 decades.
High income social tenants
But ministers also want to ensure landlords have the powers they need to charge tenants on higher incomes a rent closer to the market rate.
From 2015, these limits on social rent levels would be lifted for instances where tenants earn at least £60,000.
And when possible, new rules would be introduced requiring those social tenants earning above this threshold to declare their income to their landlords.
Housing Minister Kris Hopkins said:
Today’s proposals offer a fair deal on rents for tenants, helping with their cost of living and ensuring those who can afford to pay more do and those on lower incomes know what to expect.
But it also offers the certainty and stability councils and housing associations need too, to plan ahead and invest their revenues to build more affordable homes in their area.
This and the £23 billion of public and private investment planned in the 3 years after 2015, means we’re on track to deliver the fastest rate of affordable housebuilding for 2 decades.
The consultation, Rents for social housing from 2015 to 2016 is published today and is available for download. The deadline for responses is 24 December 2013.