In the letter he says he would be “perfectly happy” to take forward an order under the 2001 Regulatory Reform Act regularising future increases for assured tenants after 52 weeks.
“This is excellent news for the sector,” said McCarthy. “It puts common sense back into annual rent increase arrangements and we hope progress will be quick, although we accept arrangements won’t be in place for the 2002 financial year.
“We had hoped legislation would be retrospective but are pleased a more sensible arrangement will be made in the future.”
Problems emerged when the East Thames Housing Group and Network Housing Association announced a test case covering rent increases. Revised notices and breaches of annuality meant some increases had unknowingly been implemented in a way, which may be open to legal challenge.
This was because rents were being raised before 365 days had passed (Housing Today, 31 May).
The case will still go ahead, with sector-wide financial support, but ambiguity over annual rent increases will be removed by the replacement of the first anniversary rule with the more specific 52 weeks. Federation policy officer John Bryant warned: “RSLs should take note that this still has to go through a lengthy parliamentary process and will not be in effect before 2003.
“Housing associations increasing rents in April this year should make sure procedures are strictly in compliance with current law.”
Falconer also announced the replacement of the current rent increase notice with a new, simplified form to be available in time for RSLs to use for April increase notification.
The new form will be available for use no later than 20 February, and will be placed on the DTLR website. There will be a four-month transitional period during which both the old and the new versions of the form will be valid.
Source
Housing Today
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