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Rent Increase - Frequently Asked Questions

How your rent is set

In October 2017, the Government announced its intention to set a long-term rent deal for local authority landlords and housing associations from 2020/21 onwards.

The long-term rent deal which was confirmed by the ‘Policy statement on rents for social housing’ (February 2019), allows local authority landlords to increase rents on an annual basis by the rate of inflation, known as the Consumer Price Index (CPI) plus 1% from 2020, for a period of at least 5 years.

Your rent is made up of two elements the rent and service charges, the Government policy only applies to the rent element.

The Council has agreed to implement the increase for the 2022/23 rent year in line with the Government’s policy.  Rents will be increased by 4.1% (CPI was 3.1%) from Monday 4 April 2022. 

As a result, the average rent for council tenancies will be around £92.68 per week up from the average of around £89.03 in 2021/22.

We fully understand that any increase in rent will not be good news, and it will have a significant impact on some of our tenants.  We are here to help. We recommend that you contact the Financial Inclusion Team at Colchester Borough Homes for advice and support on budgeting for the rent increase.  You can contact them by emailing FIT@cbhomes.org.uk

Service charge costs are set to cover the cost of providing a particular service to you and are not calculated using the rent calculation outlined above.  Any change in your service charge will be a direct result of whether the cost of providing the service has increased, decreased, or stayed the same.  We will provide you with a full breakdown of your service charges when we write to you with your Rent Notice in March.

We aim to provide efficient well managed services and purchase services from other providers at the best rates possible so that any increases are kept to a minimum.  Unfortunately, there have been significant increases for certain services including gas and electricity and for leaseholders the cost of building insurance, this does mean that we have had to reflect this in the service charges for the coming year. 

To help give residents a clearer understanding of the decision, how the additional rent will be used and the support available for tenants we have developed some Frequently Asked Questions (FAQs) below:

 

 

Why are you increasing my rent?

We understand that any increase in rent will not be good news. However, we are committed to ensuring our tenants get the best possible support from the council and our housing management company Colchester Borough Homes (CBH).

Following the change in Government policy from April 2020 we can increase rents by the rate of inflation (CPI) + 1%. The CPI figure was announced by the government on 20 October 2021 and was 3.1%.

We have not taken the decision lightly, but increasing the rents will help us fund our commitments to repair and improve your home and the other properties we rent to tenants, further helping develop a Better Colchester.

How much is my rent increasing by and how have you calculated this?

Rents will increase by inflation (CPI) + 1%.  CPI was announced in October 2021 as 3.1% so the total increase will be 4.1%.

This means, for example, in 2022/2023 the average rent will increase from £89.03 to £92.68 an increase of £3.65.

This compares favourably with rents charged by local Housing associations and privately rented homes, for example the average weekly rent in 2020 was £100.61 for Housing associations and £188.54 for privately rented homes.

When does the new rent start?

The new rent will take effect from Monday 4 April 2022. The Rent Notice letters will be sent out to all tenants in early March.                             

Will the rent increases affect my Universal Credit payments?

If you already claim Universal Credit you will not need to complete a brand-new claim with the Department for Works and Pensions (DWP). Once we write to inform you of your new rent you will need to inform the DWP of the change in rent using your online Universal Credit Journal after the rent increase has been applied.

As the new rent increase will start on Monday 4 April 2022 you will need to inform the DWP on or just after this date as we will then be asked to verify the increase on their landlord portal.

What if Universal Credit doesn’t cover the rent increase?

If your Universal Credit allowance isn’t increased to cover the additional rent increase, we strongly recommend that you contact the Financial Inclusion Team and one of our specialist advisors will help you with budgeting for the increase. You can contact them by emailing FIT@cbhomes.org.uk

I claim Housing Benefit, will this cover the rent increase?

If you are in receipt of Housing Benefit the amount you receive will automatically be amended from 4 April 2022, when the new rent year starts. The rent notice you receive will show the amended Housing Benefit amount.

Do I have to adjust my Direct Debit mandate or Standing Order with my bank, or will you do this automatically for me?

If you pay by Direct Debit you will not have to do anything as they will be automatically adjusted by our finance team. You will be notified separately of the revised payment amounts.

However, if you pay your rent by Standing Order you will need to contact your bank to amend the payment to the new amount advised in your Rent Notice. Please ensure your Standing Order is set-up for the correct amount as shown in your rent notice to prevent your rent account falling into arrears.

Where can I get some debt and budgeting advice?

CBH have a dedicated specialist team that work alongside the rent income team who are trained to ensure you have maximised your benefits, help you manage your finances and support you through changes in circumstances. More information is available on the CBH website – https://cbhomes.org.uk/you-and-your-home/money-advice or you can email the team at FIT@cbhomes.org.uk.

Alternatively, there is advice and support available from Citizens Advice, National Debt Helpline, or the Money Helper Service.

Do you have to increase my rent?

No, we don’t have to increase your rent. It is up to each local authority to decide if they want to implement the increases.

The increase in rent enables us to continue to deliver the high-quality services to tenants. If we didn’t increase the rents, we would have less money to invest in maintaining your home, the upkeep of the surrounding area and in developing new homes.

What will you spend the additional rental income on?

We will use the additional money we will have available as a result of the rent increases to deliver the objectives set out in the business plan which runs until 2052, including;

  • increasing affordable housing supply
  • providing healthy and safe homes
  • renewing kitchens and bathrooms
  • insulating and heating, including roofs and installing energy efficient boilers
  • adapting properties to meet tenants’ needs
  • improve and modernise sheltered housing schemes

We will keep you informed regularly on how we are performing against all our objectives.

Colchester Borough Homes Annual Report 2020 to 2021 (cbhomes.org.uk)

I pay a service charge, do the same increases apply?

Service charges are not calculated in the same way as the rent increase. Any change in your service charge will be a direct result of whether the cost of providing the services has increased, decreased, or stayed the same. We will provide you with a full breakdown of your service charges when we write to you with your Rent Notice in March.

What do I do if I can’t afford the increase?

Our priority is to support tenants to sustain their tenancies and we want to help prevent rent arrears occurring as much as you do. CBH Community Housing Officers and Financial Inclusion Team are trained to ensure you have maximised your entitlement to welfare benefits, help you manage your finances and support you through changes in circumstances.

Please take advantage of this service to help you prepare for the rent increase. More information is available on the CBH website – https://cbhomes.org.uk/you-and-your-home/money-advice or you can email the team at FIT@cbhomes.org.uk.