PURPOSE OF RENT RESTRUCTURING
•To reduce the difference between Council and RSL rents,
•To reduce the difference between the rents of different RSLs (including co-ops) in the same area.
Why should rents be similar?
•Because its fairer,
•People should pay similar rents for similar properties in the same area.
What are the downsides?
Tenants on lower rents will have to progressively pay more.
Because RSLs have 10 years to achieve the new uniform rent levels from 2002 to 2012.
Why are Council rents cheaper than RSL rents?
•Council housing tends to be older whilst RSL properties tend to be relatively new,
•The level of grant ‘in the good old days’ was much higher than now so the rent has to be higher to compensate.
Why are RSL rents different for similar properties in the same area?
•Grant rates have varied a lot over recent years so more recent properties are more and more expensive,
•The level of grant is now often insufficient to build new properties and subsidies are required. RSLs with high reserves can provide higher subsidies, giving lower rents.