Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Social housing rent hike cap ‘will save average tenant £200 next year’

Landlords welcomed the 7% cap (Joe Giddens/PA)
Landlords welcomed the 7% cap (Joe Giddens/PA)

The Chancellor has said he will cap the increase in social housing rents at a maximum of 7% in 2023/24, saving the average tenant £200 next year.

Jeremy Hunt told the Commons during his autumn statement on Thursday that without the cap, families living in the social rented sector could face rent hikes of up to 11%.

He said that such a hike would “clearly be unaffordable” for the four million families – almost one-fifth of households in England – who live in the social rented sector.

Chancellor Jeremy Hunt delivering his autumn statement to MPs in the House of Commons
Chancellor Jeremy Hunt announced the cap during his autumn statement (House of Commons/PA)

“Around four million families live in the social rented sector – almost one-fifth of households in England,” he told MPs.

“Their rents are set at 1% above the September inflation rate, which means that on current plans they are set to see rent hikes next year of up to 11%.

“For many, that would clearly be unaffordable, so today I can announce that this Government will cap the increase in social rents at a maximum of 7% in 2023/24.

“Compared to current plans, that is a saving for the average tenant of £200 next year.”

Previously, social landlords could increase rents in line with the Consumer Prices Index (CPI) plus one percentage point.

The CPI in September was 10.1%, which means rents could have risen as high as 11.1% without the cap.

The 7% cap was welcomed by landlords, who warned that a lower cap would have been a “potentially apocalyptic scenario” for some.

The Department for Levelling Up, Housing and Communities (DLUHC) had floated that social rent increases could be capped as low as 3%.

Samantha Grix, partner at Devonshires – who represents Registered Providers (RPs) of social housing – said: “Setting the rent cap at 7% will come as a huge relief to registered providers (RPs) and prevents a potentially apocalyptic scenario for some.

“RPs are facing a perfect storm of costs including fire safety and decarbonisation, so limiting rent increases to 3% or 5% would have been untenable for many.

“However, the higher cap will allow RPs a bit of headroom to ensure their viability and allow them to deliver the much-needed low-cost housing they provide to this country.”

However, Alex Diner, senior researcher at the New Economics Foundation, said that the 7% maximum increase will cause “huge concern” for millions of households.

“The news that social tenants could now be hit by sharply rising rents will cause huge concern and anxiety for millions of households across the country,” she said.

“More of the most vulnerable people, who are already facing skyrocketing food and energy bills, are likely now to be plunged into further financial hardship by this government’s decision.”

While Alicia Kennedy, Director of Generation Rent, called for support for private renters as well.

“As the Chancellor announced plans to cap rents in the social housing sector, and extended access to mortgage support, he left private renters vulnerable to unaffordable rent increases,” she said.

“Market rents have risen by 12% in the past year, and it is very easy for landlords to raise the rent on their current tenants when they can threaten a no-fault eviction.

“Freezing rents, suspending no-fault evictions and relinking Local Housing Allowance to actual rents would ultimately benefit the public finances by preventing homelessness, and keeping people near their jobs. Instead, private renters face a winter of hardship, particularly the one in four who are in fuel poverty.”