Rents would be over 20% more a week if housing stays with Council
Research carried out by independent advisers has indicated that average council house rents in the Highlands will rise to £83.14 a week in 8 years if the proposed transfer of housing does not take place. By contrast, if transfer goes ahead, Highland Housing Association is committed to an average rent of £68.61 a week.
This would mean that average rents would be £14.53 (21.18%) a week more with the Council than with Highland Housing Association after 8 years.
By 2014/15 this would mean tenants paying almost £700 a year more if housing stays with the Council.
Independent advisers, Arneil Johnston, were commissioned by the Council to look into the effects of a no vote by tenants in this October’s housing transfer ballot.
The research considers what the Council would need to charge in rent if it is to have enough money to bring housing up to the Scottish Housing Quality Standard. It forms part of a report being presented to Thursday’s (September 7th) Council meeting which asks the Council to approve the transfer proposals.
Gordon Fisher, Highland Council’s Director of Housing, said: “We know from consulting tenants and research that rent levels are a real concern. If housing stays with the Council, rents will have to rise faster to pay for the work needed to bring housing up to the Scottish Housing Quality Standard.”
Highland Housing Association is guaranteeing to peg rent rises to the cost of living for the first five years. For the next five years it is planning to keep rent rises to no more than half a percent above inflation. By contrast, the Council would have to initially raise rents by 3.5% over inflation each year - and then by 3% more than inflation for the next three years. This is based on inflation of 2.5% over this period.
Under the transfer proposals, the Council’s current £160 million housing debt will be written off by the UK Government. At present 41p in every pound of tenants’ rents goes towards paying off past debt. This will mean that the rents can be used to pay for new investment while keeping rents lower.
The Council is required to explain to tenants what rents would be if council housing transferred - as compared to what they would be if housing stayed with the Council. These will form part of transfer proposals being sent to all tenants during September.
Under the proposals all of The Highland Council’s council houses will transfer to the not-for-profit Highland Housing Association – but only if the majority of tenants voting in a ballot back the move.
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