Hampshire County Council

Executive Member, Policy & Resources Item

6 November 2002

Residential properties - Review of rents in April 2003

1

Summary

1.1

The following decision is sought:

That rents charged in respect of County Council dwellings which are let to staff and other tenants be increased by 3% with effect from 1 April 2003

2

Reason(s)

2.1

The County Council has traditionally reviewed the level of rents charged to its residential tenants on 1 April each year and it is proposed to do so in 2003. The proposed increase of 3% takes account of research undertaken into the general rise in rents in both the public and private sectors over the last 12 months.

3

Other options considered and rejected

3.1

Not applicable

4

Conflicts of interest declared by the decision-maker or a member or officer consulted

4.1

None declared

5

Dispensation granted by the Standards Committee

5.1

Not applicable

6

Reason(s) for the matter being dealt with if urgent

6.1

Not applicable

Approved by:

..........................

Date of decision:

.........................

Councillor T K Thornber

Hampshire County Council

Executive Member, Policy & Resources Item

6 November 2002

Residential properties - Review of rents in April 2003

1

Background

1.1

The County Council owns around 140 dwellings. Most are occupied either by a current member of staff such as a caretaker under a service tenancy,

or by a private resident under a secure tenancy protected under the provisions of the Housing Act 1985. There are a small number of dwellings which are made available for letting to new members of staff under the Council's Staff Temporary Housing Scheme.

1.2

The Land Sub-Committee at its meeting in January 1990 resolved that the level of residential rents should be assessed by reference to market values. Since then, the level of rents has been reviewed on an annual basis and, in recent years, rents have been increased by 5% in April 2000, 4½% in April 2001 and 4% in April 2002. It should be noted that there are some service tenants who pay rent based on their salary rather than the rental value of the dwelling they occupy.

2

Recent trends

2.1

The private letting market in Hampshire has remained healthy during the past 12 months, with a good supply of properties available in this sector coupled with a relatively strong demand. The steady increase in rental levels seen in this sector over the last few years has continued although increases during the past year have been less than in previous years. As usual, changes in rental levels during the past year have varied across the county, depending upon the type of accommodation and location, with some areas reporting only marginal increases of 1-2% and others reporting increases of up to around 5%. Overall, increases in rental levels over the past 12 months have averaged around 3%.

2.2

The setting of rents in the public sector by housing associations and housing authorities is not market led. Property owners in this sector are restricted in their ability to increase rents and in the current year this was limited to 0.5% above inflation. This has resulted in increases of around 2%.

3

Proposals

3.1

It is proposed that rents in respect of County Council accommodation should be increased by 3% with effect from 1 April 2003. This is consistent with the policy linking increases to those in the private rented sector and is only slightly above the level of rent increases imposed by housing associations.

3.2

It should be recognised that the County Council is not in a true market position, with its properties occupied by a mixture of secure tenants, service tenants and Staff Temporary Housing Scheme tenants. The proposed increase will keep County Council rents well below current market rents, reflecting the nature of the Council's housing stock and the occupation arrangements.

3.3

In accordance with established procedures, it is intended that UNISON be informed of the proposals.

4

Financial implications

4.1

The current annual rental income from the County Council's stock of housing accommodation amounts to approximately £440,000. The proposed increase of 3% would increase the current annual rental income to around £453,000.

Recommendation

That:

Rents charged in respect of County Council dwellings which are let to staff and other tenants be increased by 3% with effect from 1 April 2003.