Agenda item

Purpose of Report

To enable the Executive to consider a proposition to increase council house rents in line with the Government’s Rent Policy for social housing (April 2020) and to seek approval for the introduction of revised rents from Monday 5 April 2021.

To seek approval for an increase of 3% on Council garage rents for 2021/22 in line with other fees and charges revisions by the Council.

Decision

That the Executive:

(1)       Support the basis of rent calculation for changes to individual Council         house rents as set out in the report, which represents an increase in the   average calculated 52-week Council house net rent in 2021/22 of 1.5%            for social housing rents (£1.05 per week) and affordable rents (£1.61             per week) increase per property and that this be recommended to    Council for approval.

(2)       Support the increase in Council garage rents for 2021/22 in accordance     with the proposal set out in the report, equating to a 3% increase, and    that this be recommended to Council for approval.

Alternative Options Considered and Rejected

None.

Reason for Decision

In keeping with the Housing Business Plan approved by Council and the Government’s Rent Guidelines, the formula rent rise for 2021/22 was based on the Consumer Price Index in the previous September. In Lincoln’s case this equated to an average rent increase of 1.5% from Monday 5 April 2021.

During the last nine months the Council had continued to add to its housing stock via the buy-back programme. Between 1 April 2020 to 18 December 2020 the following properties had been acquired as part of this programme:

·         one bedroomed properties – 3;

·         two bedroomed properties – 11;

·         three bedroomed properties – 10;

·         four bedroomed properties – 2;

·         four/five bedroomed properties – 1.

The Government’s Right to Buy Programme sales had negatively impacted on the Council’s current stock and rental income between April to December 2020. To date, 17 properties had been sold which was lower than projected due to the Covid-19 pandemic but since July the Council had received 37 Right to Buy applications. The loss of three-bedroomed properties in particular had a significant impact on the Council’s ability to provide family homes.

The average weekly rent for the City of Lincoln Council, based on data at 18 December 2020 for net social housing rent calculated over 52 weeks, would increase from £69.79 in 2020/21 to £70.84 for 2021/22. This equated to an average equivalent increase of income per property of £1.05 per week over 52 weeks. The 50-week average rent would be charged at £73.67.

There were currently 260 properties charged at an Affordable Rent which was higher than social housing rent. Based on data at 18 December 2020 the increase, on the average weekly net rent calculated over 52 weeks, would result in rents moving from £107.82 in 2020/21 to £109.43 per week for 2021/22, equating to an average equivalent increase of £1.61 per week over 52 weeks

An increase in garage rents of 3% was proposed in line with the authority’s fees and charges increase. This would result in an average increase in the rent charged to £8 per week for 2021/22 based on a calculated 52-week charge period, equating to an increase of £0.24 per week. Research had shown that the garage rents in Lincoln were mid-range when compared to similar locations in the East Midlands.

Councillor Donald Nannestad shared his concern that the Government’s Right to Buy Programme continued to impact the Council’s housing stock, with every property sold decreasing the amount of rent the authority was able to collect. Lots of people were still waiting for Council properties with there being significant pressure on the housing register and he added that the authority was losing properties to this scheme at a faster rate than it would able to acquire or build them.

Councillor Ric Metcalfe made the point that a significant proportion of those houses purchased through the Right to Buy Programme were now owned by private landlords as opposed to former tenants enjoying the benefits of owning their own home.