Kirsty Wells: Rent rises need to be justified by good service

Tenants must get value for money from landlords before rents can go up to fund more affordable homes, writes Kirsty Wells.

Tuesday, 24th May 2016, 11:00 am
Updated Tuesday, 24th May 2016, 12:07 pm
File photo: Rui Vieira

Following the Scottish Parliament elections, increasing the supply of affordable homes looks set to be a Scottish Government priority. One key question is how should these be paid for?

Planned increases in social rents could be one potential source of funding. However, plans by a majority of Scotland’s social landlords to increase rents at rates above inflation have recently prompted the Scottish Housing Regulator to raise concerns about the impact on affordability for tenants.

Equally, there is evidence to suggest that tenants are willing to tolerate higher rents in certain circumstances. The Scottish Housing Regulator acknowledges that providing new affordable homes goes to the heart of many social landlords’ core purpose. However, the quid pro quo for accepting rent rises to pay for new homes is that tenants need to feel satisfied that the services they receive from landlords represent good value for money.

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Among other things, getting to grips with this issue requires landlords to understand better what drives tenant satisfaction. That can be quite complicated. For instance, value for money comes only third in the list of key drivers of tenant satisfaction, trumped by a tenant’s perception of the quality of their landlord’s repairs service and the extent to which they feel their landlord is listening to their views.

By being open and transparent about the resources required to deliver services, landlords and tenants can develop a shared understanding of the potential impact on future rent charges.

Ultimately, tenants and the regulator need to be satisfied that landlords are providing good value for money across all aspects of their business. Only then will above-inflation annual rent increases which could help to pay for more new affordable homes continue to be accepted in Scotland.

• Kirsty Wells is head of HouseMark Scotland