What are the legal constraints when it comes to rent increases? 

For most social housing providers in England, rent increases are governed by the Government’s Rent Standard, which is regulated by the Regulator of Social Housing.  

Currently, the standard allows rents to increase each year by a maximum of the Consumer Prices Index (CPI) plus one per cent. This is known as the CPI+1 formula. 

However, in response to the cost-of-living crisis, the Government imposed a temporary rent cap of seven per cent for the 2023/24 financial year – even if CPI+1 would have allowed for more.  

You must keep an eye on annual policy changes like this, as they override the standard formula. 

Which properties does the Rent Standard apply to? 

The Rent Standard applies to registered providers of social housing, including housing associations and local authorities, but there are exceptions.  

The Rent Standard does not apply to: 

• Temporary social housing 

• Intermediate rent products 

• Specialised supported housing 

If you manage properties in these categories, your rent-setting freedoms may be wider – but that doesn’t mean you can increase rents arbitrarily. You still have contractual and statutory obligations to your tenants. 

Giving notice of rent increases 

Even if your rent increase falls within the permitted cap, you must follow the correct notice procedures. For assured tenancies, this typically involves serving a formal notice of increase under section 13 of the Housing Act 1988.  

This must be in a prescribed form and give at least one month’s notice. Failing to issue proper notice may mean the increase is unenforceable.  

You’ll also need to consider what your tenancy agreement says – some agreements will limit the frequency or amount of any increase or require a specific process to be followed. 

Justifying service charge increases 

If your tenants pay variable service charges, increases must be justifiable and reflect actual costs.  

Unlike rent increases, there is no statutory cap, but tenants have the right to challenge unreasonable charges at the First-tier Tribunal. 

To stay on the right side of the law, make sure service charges are: 

• Reasonable in amount 

• Reasonably incurred 

• Supported by clear records and breakdowns 

Transparency is key here – if tenants understand why costs have gone up, they’re far less likely to challenge them. 

Don’t forget the Equality Act 

When increasing rents or service charges, you also need to consider your duties under the Equality Act 2010.  

If a tenant is disabled, for example, and a rent increase would prevent them from affording essential adaptations or remaining in their home, you may be required to make reasonable adjustments. 

Rent-setting policies should be regularly reviewed to ensure they don’t inadvertently disadvantage particular groups of tenants. 

Our thoughts  

As a landlord, you are entitled to review and increase rents – but it must be done within the framework of national policy, regulation, and tenant law.  

We suggest that you: 

• Stay up to date with government guidance and rent caps 

• Use the correct legal procedures for notice 

• Comply with tenancy terms 

• Justify service charges clearly 

• Keep equality obligations in mind 

A cautious approach now can prevent costly disputes down the line and if you’re ever unsure about the legal limits of a proposed increase, it’s always wise to seek specialist advice.  

Speak to our expert social housing solicitors for more information or tailored guidance.