Market rents no solution for social housing

9 Dec 99
Social housing rents would soar beyond the means of most tenants if they were based on the market value of properties, says a new survey.

10 December 1999

Many occupiers would as a consequence fall into the benefits trap – so undermining the government's Welfare to Work agenda, claims research carried out by the University of Cambridge and London School of Economics.

Their report, commissioned by the Chartered Institute of Housing, Local Government Association and National Housing Federation, calls for rent-setting to take account of people's income rather than social landlords being forced to generate a rate of return based on capital values.

If rents were set at an affordable level, the housing benefit bill should fall and the government would only incur a small increase in overall public expenditure, says the report, Evaluating Housing Affordability, published on December 2.

'The government cannot continue to bury its head in the sand,' said Paul Jenks, chair of the LGA's housing executive.

'The housing green paper must set out a framework for setting affordable local authority and housing association rents.'

PFdec1999

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