Shared ownership rent increases and rising inflation


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Many Registered Providers are raising concerns about the affordability of shared ownership with steep rent increases coming down the line 

For shared ownership properties, annual rent increases are usually limited to Retail Prices Index (RPI) plus 0.5%.  

With RPI currently at 11.7% and set to increase further, many Registered Providers are considering whether it is possible to implement a rent increase of less than the full RPI plus 0.5% for the next increase whilst not foregoing the increase and income for future years.

In principle, Registered Providers do have options if they decide not to pass on the full increase to shared owners to support them through the current (and hopefully temporary) sharp rise in the cost of living.  However, it is important that Registered Providers follow the rent review provisions in the lease and take into account all other relevant considerations – such as compliance with relevant charitable law and whether or not lender consent is required.  

Please contact Ian Davis or Sam Coward for more information.

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