Council house rent bills in Newcastle are poised to rise in April.
City leaders are expected to sign off on plans to impose a 2.7% hike in rent rates next week.
Newcastle City Council said that the move was needed to “maximise investment” in its housing stock, amid major concerns about a backlog of repairs and damp and mould cases.
The Regulator of Social Housing (RSH) ruled last month that there were “serious failings” in Newcastle’s council housing, as it ordered the local authority to make improvements, while opposition cllrs have called for a ‘deep dive’ probe into how the problems were allowed to pile up.
Council bosses took back direct control over around 25,000 of its properties last summer when it abolished Your Homes Newcastle (YHN), the arms-length organisation which had managed its social housing stock since 2004.
A 2.7% rent hike, alongside equivalent rises in service charges and garage rents, is expected to generate an additional £1.5 million in income for the council coffers, which the authority says it will use to help build new homes and ensure existing houses comply with health and safety standards.
The proposed increase, which will come into effect on April 1 if approved by the council’s cabinet next week, is less severe than the 7% and 7.7% rises that have hit tenants in the last two years and averages out at an extra £2.50 per week.
January’s RSH judgement pinpointed concerns over 1,800 overdue repairs, a backlog of more than 1,000 damp and mould cases, and a need for fire safety upgrades among a number of issues.
It came after the council had referred itself to the watchdog 16 different areas where it believed it was falling short of its standards.
A report published ahead of next Monday’s cabinet meeting states that the council’s housing stock “is ageing and requires investment and capital works to ensure it is decent and safe”.
It adds: “The proposed rent increase will ensure we can maximise investment capacity to build new homes and keep the current stock sustainable and compliant with health and safety legislation. There is a complex set of health and safety standards we need to meet every year – these requirements have increased through the Fire Safety Act and the Building Safety Act.
“We also need to maintain replacement of standard components such as kitchens and bathrooms on a life cycle basis. Repairs, maintenance and capital costs are also still increasing due to supply chain problems and inflationary increases in the cost of materials.”
The council said that the proposed rent hike would directly affect 6,057 tenants who pay for their bills from their own incomes, rather than through Universal Credit or Housing Benefit.
Cllr Paula Maines, the council’s cabinet member for housing, added: “Next week our cabinet will be asked to agree a 2.7% rent increase across all council and leaseholder properties and garages. We have previously seen much larger annual increases however, with careful budget management to ensure best value for tenants and leaseholders, this year we have been able to keep our rent increase in line with the UK inflation rate. The increase is also compliant with our rent policy which ensures we meet our regulatory requirement while applying any annual increase.
“We are proposing that the rents and service charges for those residents occupying specialist accommodation be set at the same level as general needs residents to demonstrate we are applying the charge equitably. The average weekly social rent increase will be £2.50, and the average weekly affordable rent increase will be £3.71.”
