Proposed council house rent increase approved by new Housing and Property Committee

29th January 2020

A proposed 3% rent increase for 2020/21 was agreed by Highland Council's new Housing and Property Committee today, 29 January. This would result in an increase in the average weekly council house rent from £75.38 to £77.64 (£2.26 per week).

Council is required to maintain a separate Housing Revenue Account (HRA) covering income and expenditure in respect of specified houses, buildings and land. There is a legal requirement for Housing Revenue Account income and expenditure to be in balance at the end of each financial year.

A number of factors, including loan charges and maintenance have been taken into account in setting the 3% rent increase recommended for 2020/21.

The main elements of Housing Revenue Account expenditure relate to housing management, repairs and loan charges.

There will be an increased repairs and maintenance expenditure of £1.780m (10%). The most significant element of this is an additional £1m to comply with new standards for domestic fire detection arising from changes introduced by the Scottish Government. A further £0.462m is included based on extra revenue available for planned maintenance based on the recommended 3% rent increase.

The Committee also agreed that this percentage increase (3%) is applied to all residential HRA rents and service charges and to Gypsy/Traveller site pitches; and that non-HRA rents for leased property should be increased as stipulated in existing contracts.

HRA revenue estimates and HRA rent increases will go to the next Highland Council meeting on 13 February for consideration and formal approval. The rent increase would come into effect from April 2020. A report on the HRA Capital Plan (2022/2027) will be presented to the next Housing and Property Committee in April 2020.

Chair of the Housing and Property Committee, Cllr Ben Thompson said: "Over the last 5 years, Highland Council rents have been increasing at a much lower rate than nationally or amongst housing associations operating in Highland. Currently our rents are 8th lowest out of the 26 councils which retain housing and 2nd lowest of the 5 main Housing Associations operating in the Council area.

The Council received extensive tenant feedback to our rent consultation and the agreed rent increase is supported by the majority of tenants."