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Fairer rents housing consultation published (12 October 2015)

Date: 12/10/2015
Duncan Lewis, Housing Solicitors, Fairer rents housing consultation published

A housing consultation published on Friday (09/10/15) proposes that social landlords will be required to administer a policy of fairer rents, under which tenants with high levels of income who live in social housing will pay a fair level of rent to continue living there.

The Housing Minister Brandon Lewis unveiled the proposals which, if approved, would see households in social housing with a total income of than £40,000 or above in London and more than £30,000 outside the capital, will pay rent at market level or near market levels.

The government says that this will end higher-income social housing tenants from benefiting from taxpayer-funded subsidies of up to £3,500 per year.

The proposals would mean social rents would increase as tenants’ incomes rise above the threshold.

Those in real need would continue to pay a subsidised rent, with the scheme ensuring that work always pays.

Housing Minister, Brandon Lewis, said:

“It’s not fair that other hard-working people are subsidising the lifestyles of higher-earners to the tune of £3,500 per year, when the money could be used to build more affordable homes.

“’Pay to stay’ will ensure that those tenants on higher incomes who are living in social housing have a rent that reflects their ability to pay – while those who genuinely need support continue to receive it.

“The money saved by councils by removing this subsidy will help contribute to the government’s £12 billion of welfare savings – and housing associations will be able to retain the additional income raised to help support their role in providing new housing.”

The scheme would be administered by social landlords and would be introduced in April 2017.

Figures show there are currently more than more than 40,000 social housing rental tenants with household incomes in excess of £50,000 per year – and a further 300,000 social housing tenants with incomes above £30,000.

The consultation suggests that local authorities would be allowed to recover any reasonable administrative costs before they are required to return additional income from increased rents to the exchequer.

The government says that as housing associations will be retaining the income they receive from higher rent payments to invest in new housing, they would also be expected to absorb the administrative costs of the fairer rent scheme.

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For expert legal advice on housing law call Duncan Lewis housing solicitors on 020 7923 4020.


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