Highland Council rents could rise by four per cent
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Members of Highland Council’s housing and property committee will tomorrow decide whether to agree a below-inflation four per cent rent increase.
A report ahead of the committee meeting says that anything under six per cent will mean a reduction in the annual repairs and maintenance budget.
But both councillors and tenants have expressed a wish to keep rents down amid the cost-of-living crisis.
Housing bosses have said that the committee needs to strike a balance between keeping rents affordable and maintaining service levels.
They have recommended a four per cent increase, which would cost the average council tenant an extra £3.20 per week. With this rent rise in place, a Highland council house rent would come in at £83.17 per week.
By comparison, average council house rent in Scotland is £89.21.
However, Highland Council says: “The trade-off for a lower than inflation rent increase is a reduction in repairs and maintenance spending.”
If members agree to a four per cent hike, the repairs and maintenance budget will reduce by £708,000.
Only a six or seven per cent rent rise will allow the council to invest more money in repairs.
Highland Council recently surveyed its housing tenants, asking if they’d prefer a three, five or seven per cent rent increase.
Unsurprisingly, 57 per cent voted for the lowest rise, though 29 per cent said they could afford five per cent.
Councillors attended a housing workshop in October and told bosses they want to do everything they can to avoid a steep rent increase, given the cost-of-living crisis.
However, the housing budget is already under immense pressure, and up for review.
The council highlights the key risks as cost inflation, increased rent arrears and uncertainty around the annual staff pay rise. This last is budgeted for a five per cent pay award, but any more could mean service cuts.
Highland is not alone in this struggle. The housing report outlines that Cosla has discussed rent increases in the region of 6.4 per cent and housing associations are also looking at a figure upwards of six per cent.
In a bid to get the balance under control, Highland Council plans to cut its budget for environmental improvements.
That budget has increased over recent years, and allowed the council to make housing estates nicer, through measures such as landscaping, planting and art. But Highland Council is now planning to bring the budget back down.
Other key figures from the report include an eye-watering £26.291 million in capital loan charges – that’s how much Highland Council pays back for the money it borrows to invest in its housing stock.
However, just seven per cent of council houses meet current regulations on energy efficiency, so the council does need to invest.
It has set out plans to add insulation, glazing and heating in the year ahead, which would get 49 per cent of its homes up to scratch.
