Hounslow Council opt for maximum social rent increase from April

Image above: Hounslow House, headquarters of Hounslow Council

Social rents in Hounslow will increase by 7.7%

Hounslow Council has put forth a proposal for a significant 7.7% increase in social housing rents starting from April, the maximum allowable hike according to government regulations.

This rise is compounded by additional cost increments for tenants, covering heating and service charges. A report due to be presented to the Council’s Cabinet is seeking permission to delegate authority to the Executive Director for Regeneration and Housing, in consultation with the Cabinet Member for Housing Management and Homelessness, to implement the proposed rent hikes.

The calculated increase in social housing rent is based on the Consumer Price Index (CPI) plus 1%, aligning with the policy outlined by the Social Housing Regulator in January 2024. The government’s Policy statement on rents issued in February 2019 allowed for annual rent increases on social and affordable rent properties, up to CPI plus 1 percentage point from 2020. This was stipulated for a minimum of five years following the completion of the rent reduction period, as mandated by the Welfare and Reform Act.

The maximum rise was capped at 7% last year to alleviate the cost-of-living pressure on tenants. In the absence of this restriction, the increase would have been a higher 11.1%.

The council argues that this limitation, imposed during a period of high inflation and rising interest rates, led to a reduction of funds in the Housing Revenue Account (HRA). Without the maximum rent increase, the Council foresees a permanent reduction in resources, hindering their housing business plan and diminishing funds available for investment in both new and existing housing stock.

Average weekly rents to go up by almost £10

As a consequence, the average weekly rent for social housing across the borough is expected to surge from £121.23 to £130.56. Rent variations will occur based on the property’s valuation, type, and location.

Failing to fully cover the costs of services funded by charges could force the Council to reduce service levels or have tenants who do not use these services subsidising them. Communal electricity prices are set to spike by 20%, and where tenants are eligible for housing benefits, services charges stipulated in the tenancy agreement are generally covered.

Properties on District Heating systems without individual meters will continue to receive a weekly charge for District Heating consumption. Gas and electricity consumption charges, which increased by 100% and 90% respectively between 2022/23 and 2023/24, are proposed to see a further increase of 6.7%.

Caretaking and cleaning services are also slated for an 11.9% increase, outpacing the rate of inflation, attributed to under-recovery in previous years.

The freehold service charge management fee is set to rise to £347 per property from April, with reduced fees for those receiving fewer services. Additionally, there will be a 6.7% increase in garage rents for tenants, leaseholders, and private lets.