Thousands of South Tyneside Homes tenants to see rents cut

South Tyneside Homes is cutting rents for its social property tenants by one per cent - in line with Government instructions.

The Welfare Reform and Work Act 2016 requires social and affordable rent levels to drop by one per cent a year from last April.

A one year exception for supported housing was announced in January 2016, but that exemption no longer applies.

A South Tyneside Council spokeswoman confirmed rents would be cut in line with the requirements of the legislation for tenants in its 17,000 social properties.

She said: “Taking account of the Government guideline for rent levels, the average rent charge for a South Tyneside Council home will decrease to £72.65.

“This is a decrease of one per cent,

“Rents will decrease by £0.73 per week on average from £73.38 to £72.65.”

Housing associations were instructed to cut rents by one per cent a year over four years as part of a Government drive to reduce the country’s housing benefit bill.

The change to the formula by which social rents are calculated was introduced by George Osborne in his first Budget after the general election.

Socil housing providers had previously been able to raise rents in line with the consumer prices index (CPI) plus one per cent.

The Chancellor said the move was intended to end ‘the ratchet of ever higher housing benefit chasing up ever higher rents in the social housing sector’.

The Government claimed the cumulative effect of the cuts would be the equivalent of a 12 per cent reduction in average rents for social tenants by 2020/21 and ‘will allow social landlords to play their part in reducing the welfare bill’.