Housing Associations Increase Rents and Service Charges

Most housing associations across Great Britain have increased rents in April by at least 5%, which caused fierce opposition by tenants. The rents were calculated on the basis of the retail prices index (RPI) measure of inflation as of last September. However, the increases in rent are far higher than current rate of inflation. At the moment RPI is at its historic low of 0.1% and still continues to fall, but the rates of housing associations have risen. The rise in rents was registered in September just when oil and food prices were at their peak before the economic crunch. Moreover, government guidelines allow associations to further increase rents by an additional 0.5%, as well as to introduce rises in service charges. Some associations have introduced rises of up to 8.5% without prior consultation with tenants. The majority of tenants have reacted angrily. For instance, Viewpoint housing association tenants in Edinburgh, Scotland plan to go on a rent strike, while others have lobbied members of parliament and local councils. Some Homes for Haringey association tenants in north London claim that their new service charges have increased by as much as 50% and they are campaigning against it. The amount of housing association’s tenant in Great Britain is sharply increasing as tenants vote to change their tenure from local authorities to housing associations. These so-called “stock transfers” are still taking place. Currently, an average of 2.3 million housing association tenants are registered in the UK. Governments guidelines imply that by 2012 rents and service charges in all areas should be the same, while at the moment they are starkly different as they depend on subsidies and various levels of support. A regulatory body for affordable housing - The Tenant Services Authority (TSA) – says it cannot influence the decision of housing associations on rent increases.