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PRPSH rents

This content applies to England

Rent levels for tenants of private registered providers of social housing.

Setting rents – the Rent Standard

Private registered providers of social housing (PRPSHs) must charge rents in accordance with the Rent Standard, as set by the regulator of social housing (Homes and Communities Agency).[1]

Social rent levels are set by a reference to a formula.[2] The aim of the formula-based approach is to ensure that similar rents are paid for similar properties. The current formula is devised on the basis that social rents take account of:

  • the condition and location of a property
  • local earnings
  • number of bedrooms in a property.

Exclusions

Properties let on 'affordable rents' and rents applied to high-income tenants are not covered by this formula.

Affordable rents can be set at up to 80 per cent of the market rent. For more information see Affordable rents.

From April 2015, a PRPSH can charge a market rent to tenants with an annual household income of £60,000 or more. In calculating household income, only the income of the tenant or joint tenants, and her/his spouse, civil partner or cohabitee are to be taken into account. In the event that more than two of these members of the household have an income, only the two highest incomes are to be taken into account.[3]

Rent increases and variations

Normally, rents for tenants of PRPSH's are increased annually.

Social rent reduction

From 1 April 2016, PRPSHs are required to reduce rents by 1 per cent per annum in each of the following four years.[4] The government has published guidance about the operation of this requirement.

For social rents the reduction applies to the rent element and not to service charges, for (most) affordable rent properties, the reduction applies to the total rent, inclusive of service charges.[5]

Exceptions to and exemptions from the requirement to reduce the rent are set out in regulations, and include:[6]

  • temporary social housing and short-life leasing schemes for the homeless
  • residential care homes or nursing homes
  • certain specialised supported housing developed in partnership with councils, local health or social services offering a high level of support for clients, for whom the only alternative options are care homes.

From 1 April 2017, the following are also exempt:[7]

  • shared ownership 
  • domestic violence refuge accommodation
  • almshouse accommodation
  • accommodation provided by a co-operative or fully mutual housing association
  • accommodation provided by a community land trust.

Rents by security of tenure

The protection that PRPSH tenants have regarding rent levels and rent increases primarily comes from the Rent Standard (see above).

However, the framework providing for increases to rents of assured and assured shorthold tenants of private landlords, and the mechanism for challenging rent increases, applies equally to assured and assured shorthold tenants of PRPSHs. For more information see Assured or assured shorthold tenancy rent increases.

A secure tenant of a PRPSH is subject to the fair rent regime under the Rent Act 1977. For more information see Fair rents for different tenancies.

Wales

The information on this page applies only to England. Go to Shelter Cymru for information relating to Wales.

[1] s.193 Housing and Regeneration Act 2008.

[2] Ch.2 Guidance on Rents for Social Housing, DCLG, May 2014.

[3] Direction on the Rent Standard 2014, DCLG, May 2014; para 2.5 Rent Standard 2015, HCA.

[4] s.23 Welfare Reform and Work Act 2016; Welfare Reform and Work Act 2016 (Commencement No.1) Regulations 2016 SI 2016/394.

[5] reg 16 Social Housing Rents (Exceptions and Miscellaneous Provisions) Regulations 2016 SI 2016/390.

[6] Social Housing Rents (Exceptions and Miscellaneous Provisions) Regulations 2016 SI 2016/390.

[7] reg 3 Social Housing Rents (Exceptions and Miscellaneous Provisions) Regulations 2016 SI 2016/390, as amended by Social Housing (Exceptions and Miscellaneous Provisions) (Amendment) Regulations 2017 SI 2017/91.

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