What is rent restructuring?
In 2001 changes were made to the way that the Government subsidises the Housing Revenue Account (HRA), by introducing rent restructuring. Under a process known as ‘convergence’, the rents of Waltham Forest properties will be increased incrementally each year, so as to reach restructured levels by 2011/12.
This process encourages local authorities and housing associations to set their rents based upon a range of factors, including average wages, property size, location and condition.
However, there is a limit of the limit on annual rent changes, so reaching the target rents may take much longer for some properties.
Why is this taking place?
The Governments reasons for rent restructuring are:
- To ensure social rents should remain affordable and well below those in the private sector
- To ensure social rents should be fairer and less confusing for tenants
- To provide a closer link between rents and the qualities which tenants value in properties
- To remove unjustifiable differences between the rents set by Local Authorities and Registered Social Landlords
This process is intended to achieve a ‘harmonisation’ of rents, so that similar properties in the same area should have similar rents, and should also help prepare the way for the Government to extend its reforms on Housing Benefit to tenants in the social sector.
More information about rent restructuring:
