Tenants on a social housing estate in north east London are to be asked to pay a means-tested rent - thought to be the first scheme of its kind in the country.
Although Letting Agent Today normally reports solely on the private sector, the current wide-ranging debate about rents in the UK suggests the issue may be of interest to a wider readership and could fuel the debate amongst private landlords and agents.
The scheme is being pioneered on New Era estate in Hoxton, where residents have held high profile protests in the past year when the estate’s previous owners - Westbrook Partners, a New York-based investment firm - planned to increase rents, which at the time cost less than 50 per cent of the market rate in the surrounding area.
Now the estate is owned by not-for-profit landlord Dolphin Living - a subsidiary of the Dolphin Square Charitable Foundation, set up by Westminster council - and the new owner has set out the proposed new rent structure.
New Era residents will now be given the choice to either stay on their current contracts and face annual rent increases of 4.5 per cent above inflation, or move to the means-tested contracts. If they choose the latter, they must provide evidence of their household income every three years.
The Financial Times, which broke the news, says it could mean tenants paying different amounts for similar properties, because it will take into account circumstances such as the number of children in a household.
The idea is not only of interest to those in the private sector; under a ‘pay-to-stay’ policy announced in last month’s Budget, households earning more than £40,000 in London and £30,000 in the rest of the UK must pay higher rents to remain in social housing.