I have noted that some Housing Associations are, on a yearly basis, increasing rents payable by tenants. For instance, Moat has increased their rent from £400 for a two bedroom flat in 2011 to about £500 in 2013.
Can the Council intervene to ensure that key workers who are serving Medway are not priced out of the housing market especially as there has not been salary increment increase for over 3 years running?
Minutes:
I have noted that some Housing Associations are, on a yearly basis, increasing rents payable by tenants. For instance, Moat has increased their rent from £400 for a two bedroom flat in 2011 to about £500 in 2013.
Can the Council intervene to ensure that key workers who are serving Medway are not priced out of the housing market especially as there has not been salary increment increase for over 3 years running?
Councillor Doe stated that the Council could not intervene in the setting of rents by Registered Social Landlords. The framework within which social housing rents were calculated was set by the Government and the regulatory authority for that was the Homes and Communities Agency which had been established in 2002, although the Government was currently proposing changes to this regime.
Currently social landlords could increase rent levels by RPI + 0.5% + up to £2 per week. The average social rent for a 2 bed roomed property per week in Medway in 2011/12 was £87.06 and that had risen 2013/14 to £94.29.
He stated that it had been suggested that the changes in rent levels that had been identified may have been due to the landlord changing the rent level regime for the particular property.
The Government did introduce a new rent regime in 2011, which allowed Registered Social Landlords to charge what was generally a higher rent on homes and that higher rent would be used to develop new homes as part of the National Affordable Homes Programme. He stated that the only time that the Council could intervene would be to complain to the Homes and Communities Agency that there had been a gross violation. Therefore, in practical terms the Council could not intervene.
He stated there had been no evidence of pricing out key workers in terms of a material block in supply of suitable properties. However, he would look into this if any such evidence were produced.
Councillor Igwe stated there was a Code of Social Responsibility to which all the key stakeholders in the housing market were assigned to in Medway and that he believed, that as a Council, there was the responsibility to make sure that that sector was well monitored especially when the key workers were renting those properties. They had to be reminded that there was a social responsibility to make sure that those residents were well taken care of.
Councillor Doe stated that he did not accept this because the regulating authority for housing associations was the Homes and Communities Agency. There had been no suggestion that their regulations had been violated. He reminded Councillor Igwe that the Council was working with housing associations to develop a variety of models for people below the market levels and one of those models which was particularly suitable was shared ownership. This could be accessed on a salary of £16,000 per year. Therefore, he did not believe key workers were being priced out. He stated that if there were any case to answer then the proper procedure was to report it to himself and Councillor Chitty.