Exciting Disruptors

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The missing link between rent and income…

Posted by Cassandra Clark 3 months ago

We are all acutely aware of the housing crisis. For many purchasing a home is not an option due to the cost involved whilst rent is becoming increasingly unaffordable. The Home Group have launched a ‘Flexible Rent’ white paper setting out a new model of renting whereby a range of affordable property solutions exist for households on a variety of incomes.

The proposal would result in a collaborative approach from both housing associations and private investors. The schemes would result in a mixture of private renters paying full market rent and some on affordable rents. If rental levels  fall there is the ability to increase the number of units held at market rent, however,  if rent increases this would allow more units to be offered at the affordable rental levels. 

A defined income would be agreed in respect of an entire development (of say around 300 units) instead of in respect of individual units thus allowing fluidity to the composition of affordable and full market rent paying units. There would be further  flexibility arising from the turnover of households across the development which would allow rents to be increased or decreased based on affordability and availability. This is a model of housing which hasn’t been explored by the housing market to date.

This proposal would also allow the integration of mixed communities assisting with the removal of the stereotypical rich and poor areas. Clearly new ways of thinking are required to tackle the affordability crisis and the housing market needs an overhaul to accommodate the variety of households  struggling in the current market. Is this a potential solution?

This post was edited on Sep 25, 2018 by Karolina Labrenz

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