Our response to the rent cap consultation

Posted on the 26th October 2022

CASE, a consortium of housing associations working in the South East which Paradigm is a member of, has responded to the Government’s consultation on a social rent ceiling.

All CASE member organisations are undertaking significant additional measures to support their residents through the cost-of-living crisis, including through funds for crisis payments and allocating more of our team members to tenancy support activities.

We encourage our residents to contact us if they are struggling with their rent payments and commit to working with residents to sustain their tenancy.

In response to the consultation, we have set out our view that:

  • it would not be right for us to increase rents in line with what is likely to be an exceptionally high level of inflation in September 2022
  • We think that the decision on the precise level of rent increases should be left to providers’ Boards, and that none of the providers in CASE would set rent at or near the maximum implied by the current formula
  • Boards are best placed to determine the right balance between rent increases and investment requirements which will sustain the provision good affordable housing and services over the long term
  • a ceiling will accentuate distortions in the current pattern of rents that we charge under existing regulatory standards
  • a ceiling would not help the majority of our least well-off residents who rely on welfare benefits, but would aggravate cost of living pressures for them by reducing investment in measures to improve energy efficiency and other investment in their homes
  • the effect of a ceiling will be to reduce the capacity to invest in new and existing homes not only directly through lower rent income, but also through a reduction in borrowing capacity because of lower interest cover and higher gearing
  • If a cap is to be applied, 7% is a preferable alternative and should be only for one year, because it will give providers more flexibility to respond in line with their circumstances and the needs of their residents.

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