Ministers have been warned plans to increase rents for affordable housing will drive up housing benefit costs and discourage tenants from seeking work. The National Housing Federation has said increasing affordable rents to 80 per cent of market levels will act as a ‘powerful disincentive to work’. Ministers plan to deliver 155,000 new low cost homes between April 2011 and March 2015 and are promising they will be ‘social homes’. However, instead of funding the homes through the social housebuilding budget – allied to private money raised by housing associations, who build social homes – they plan to pay for all the homes through massively increased rents, at up to 80% of the local market rate. To be able to deliver the promised number of low cost homes, the new intermediate rents will need be charged to all tenants moving into newly built homes and at least one in four tenants moving into existing social homes. As with traditional social housing, the tenants offered these homes will be selected from those on the council waiting list in each area. Read more on the NHF website.
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