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When is a rent reduction not good news for a tenant?

The Government has ordered social landlords (housing associations) to reduce rents by 1%. This must be good news for tenants mustn’t it? Not for a lot of the tenants Advice Nottingham are helping.

Although the Government said it would be talking to housing associations about how they would absorb the change; at least some have not tried at all. The loophole we are seeing exploited by housing associations is tenants who pay a service charge as well as rent. In one case the landlord has raised this charge by 33% and in another by 15%! The effect in each case is that the tenant ends up paying more, despite the reduction in rent. What is more, the poorest tenants (those who have to rely on Housing Benefit) are worse off because Housing Benefit does not pay towards the service charge so the amount the tenant pays has gone up while the help they get from Housing Benefit has gone down.

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