Landlords broker deals to dodge cuts

Housing associations face being forced to reduce tenants’ rents next year by 0.9 per cent, because rents are set using a formula based on September’s retail price index, which stood at -1.4 per cent.

But some tenants are prepared to meet landlords halfway to explore alternative options. They are discussing an agreement for rents to be frozen for a year in return for reduced rent increases in 2011/12.

Michael Gelling, chair of the Tenants’ and Residents’ Organisations of England, said tenants had told him they had already met with their landlords to discuss freezing rents. He said: ‘There were a number of tenants saying “we have had that discussion”.’

Tenants of Housing Hartlepool confirmed that they have been in talks with the landlord to receive lower increases in 2011/12. Alan Coxon, a member of the association’s tenants’ consultation panel, said there was a possibility that rents could go up in 2010/11, although he would still prefer a drop.

He said the panel would accept a small rise. ‘I feel [Housing Hartlepool] are going that way,’ he said. ‘I think they will put the rents up.’

The panel will discuss this with Housing Hartlepool at a meeting scheduled for 16 November, he added.

A spokesperson for Housing Hartlepool said: ‘We are still waiting for [regulator] the Tenant Services Authority to make a formal announcement regarding the national formula which will apply to the setting of rents. Following that we will meet with our tenants’ panel to discuss the issue.’

Associations have said that rent cuts will hamper their ability to meet demand for more social homes, and could also damage long-term development projects. Landlord New Charter has calculated that the 0.9 per cent drop will mean it loses an estimated £2.5 million in rent, compared with its original business plan.

News of the talks emerged as a National Housing Federation-commissioned survey of 300 tenants found 69 per cent would rather forego a rent cut of 0.9 per cent if it protected community services.

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