Rents Are 'Out Of Step' With Incomes

Vulnerable tenants are being pushed out of the housing market as cuts to benefits and rising costs mean rents are “increasingly out of step” with household incomes, a leading industry body has warned. The Royal Institution of Chartered Surveyors (Rics) said those on low incomes faced further difficulties as its members were predicting that rents would rise by more than 20% over the next five years. Rics said around a third of members it had polled thought homeless people and those on housing benefits had seen their access to rented properties fall. A key reason cited by respondents was cuts to government support for housing costs. Download the survey from the RICS website.

Council Urges Ministers To Use HMRC For Pay To Stay

Southwark Council has written to ask the Government to use its own tax office to pick up the bureaucracy that Pay to Stay will generate. The policy appears to ask local authorities to stump up the administration of means testing council tenants. Those earning over £40,000 in London will be required to pay more council rent. But a £40,000 household income in London is the equivalent of a couple earning the minimum wage and working full time and the council values working households as they help create vibrant and sustainable communities. The immense extra administration that authorities could be required to undertake would be costly, time consuming and in direct contradiction to the Government’s own guidance in the New Burdens Doctrine. Read more on the Southwark Council website.

Timetable For Introduction Of Pay To Stay

CLG officials have set out the timetable for the introduction of the 'pay to stay' scheme for council tenants with household incomes of over £31,000 (£40,000 in London).  The aim is to introduce the scheme from April 2017. Thresholds will be up-rated annually by inflation (CPI) and tenants in receipt of Housing Benefit or Universal Credit will be exempted from the policy. However, all other tenants will be required to declare their total household income to their local council to enable the council to calculate how much additional rent they will be expected to pay.  The additional rent is expected to be 15% of any income over the threshold or the full market rent for the property whichever is lower. Read more on the ARCH website.

Pensioners To Pay MORE To Stay In Social Housing!?

The Conservative’s Housing & Planning Bill includes the policy of pay (MORE) to stay which sees social tenants with a “household income” – a term as yet undefined – of more than £30,000 per year in the regions and £40,000 or more in London to pay market rents or near market rents to stay in social housing. Nowhere in this policy or in the Bill’s drafting does it say the pensioner household is exempt.  In Ealing and using the housing regulators own official figures the pensioner in a 3 bed social rented property will see the rent increase from £136 per week to around £480 per week as a result of this policy. Read more on the Speye blog.

Major Flaws Revealed In Pay-To-Stay Policy

The government’s pay-to-stay policy will not work in parts of 16 local authority areas across London because tenants will have to earn more than the £60,000 cap to be able to pay affordable rents.  Under pay-to-stay proposals outlined last month, social landlords will be able to force tenants who have a household income of more than £60,000 a year to pay full market rent or move into the private rented sector.  However, exclusive data from consultancy Hometrack reveals that in four boroughs this will not be possible for tenants paying affordable rents.  This is because tenants would need an income of up to £82,226 to pay the rent even if it is set at 63 per cent of the market rate - the average proportion charged under the scheme - rather than the 80 per cent maximum allowed. Read more on Inside Housing.