Landlords have warned that the Government’s plans to cap rents for social housing will undermine efforts to make homes safer and greener.
The Government is currently consulting on proposals to introduce ceilings on increases to rents for social and affordable homes in 2023/24.
The G15 coalition of housing associations based in London warned that the proposed caps will prevent them from investing in new homes and ensuring their current housing stock is safe.
In an update for their members, G15 said: ‘To maintain and improve existing residents’ homes, and to continue to build much needed new affordable homes, significant investment each year is essential.
‘As not-for-profit organisations, all the resources we generate are put back into the homes we provide and build, and to support the services residents receive. Re-investable rental income for housing associations is critical to supporting this work.
‘Similarly, meeting the significant challenges of building safety, decarbonisation, and addressing homelessness, requires strong and stable income for organisations.’
Based on the social rent ceilings outlined in the Government consultation, the coalition calculated that a rent ceiling at 3% would see a reduction in re-investable income of £4.6bn over the next 10 years. A 5% rent ceiling would see a reduction of £3.5bn and 7% would be nearly £2.4bn.
G15’s update concluded: ‘Further action is required by the government to support people facing cost of living pressures that are driven in most part by rapidly rising energy bills, especially those people who are least well-off.
‘In taking action to support people with the cost of living, exacerbating the housing crisis by significantly reducing resources for organisations to invest in existing homes and to build much-needed new affordable homes should be avoided.’
