G15 and Residents' Group call for ten-year settlement in responses to consultation on social housing rent policy

The G15 and its newly formed Residents' Group have backed a proposal that social housing rents should increase by CPI+1% and called for a 10-year settlement.

A Government consultation on future social housing rent policy, which closed on 23 December, sought views on a new Direction to the Regulator of Social Housing in relation to policy from 1 April 2026.

In its response, the G15, which represents the largest housing associations in London, argued that such a ten-year settlement would provide “the certainty required for strategic planning, financial confidence, and increased investment in new homes”.

Fixed guarantees are essential to re-building lender and investor confidence, the group added.

The G15 meanwhile called for the reintroduction of a fair rent convergence mechanism, which it claimed would correct rent disparities across identical homes that persist "due to historical policy inconsistencies".

The move would unlock an additional £3.5 billion for the sector over the next 10 years, the G15 said.

It added: “Ultimately this comes down to a matter of fairness; we do not think it is right that neighbours living in identical homes should be paying different rents due to historic policy decisions.”

A third G15 recommendation called for the Government to take a holistic view of the social housing sector’s financing and align rent policy with other areas such as investment and grants.

“Rent alone cannot sufficiently fund the essential investment required for existing homes, the building safety programme, net zero by 2050 and the delivery of new supply. As such, this rent settlement must be paired with additional government funding.”

The G15 said it acknowledged that any rises in rent might place extra pressure on residents at a time of particular financial strain, “however, we believe it is a necessary step in restoring our finances and enabling us to continue providing safe and affordable homes”.

A fair convergence mechanism would slowly raise rents to the income-linked formula level, “which is well established as the most affordable rental level”, it claimed.

The G15 went on to warn that the sector’s financial capacity had significantly declined due to escalating costs from repairs, safety requirements, and decarbonisation efforts.

“Without swift and decisive action, the ability to develop affordable homes and maintain existing ones will be severely compromised. Addressing these challenges is critical to ensuring a sustainable future for social housing,” it argued.

The G15’s Residents Group was set up to represent the represent the views of the residents living in the 770,000 UK homes managed by the group's members.

In an open letter, it said it agreed with proposals for a CPI+1% per annum increase to rent and a 10-year settlement..

It said: “As residents, it is a top priority for us that rent increases are kept to a reasonable and predictable level so that any increases are manageable. It is also critical that social landlords are adequately funded to be able to deliver good services and provide new homes for future generations, and we know they are heavily reliant on rental income in order to do this. The certainty that this settlement offers is therefore welcome.”

The group, however, expressed concern that residents’ rent money was now expected to pay for a very wide range of landlords’ costs. “It is right and fair that our rent contributes to the ongoing maintenance of our homes and the running of landlord services, but it cannot and should not cover everything.”

The Residents’ Group said it believed it is essential that any rent settlement contains a mechanism to protect vulnerable residents who may face hardship in the event of an inflationary spike, “especially the working poor and those on fixed incomes, who do not have access to the benefits system”.

It suggested that an absolute cap on rental increases would provide a safeguard against an inflationary shock for those who would struggle to afford it.

The residents’ open letter also called on the Government to commit, as a minimum, to consulting with residents’ groups if there is another spike in inflation, “to properly understand the potential impact”.

Expressing concern about the extent to which social landlords have become reliant on rental income to deliver services, the letter strongly urged the Government to consider what other measures it could take to provide more financial security.

“We would particularly encourage government to increase grant funding to build new social homes; allow social landlords to access the building safety fund for rented homes; and increase the financial support available through the Warm Homes Fund.”

The G15 Residents’ Group noted that the Government is not proposing to re-introduce rent convergence at this time.

It said, however, that if the Government decided to review this policy in the future and seriously considered re-introduction, it would strongly urge that a separate consultation is held with social housing residents.

Harry Rodd