Following a consultation that gathered over 3,000 responses, a 6% rent increase is being recommended for 2025/26 reflecting tenants’ views. This proposal will be considered at the Housing and Social Wellbeing Committee meeting on Wednesday 22nd January.

The proposed changes would result in an average weekly rent increase of £4.78 per week, bringing the average weekly rent to £84.52. Perth and Kinross would maintain the 4th lowest council rent in Scotland, £7.87 below the projected Scottish local authority average.

The rent increase would enable enhanced service levels for tenants, and address financial pressures faced by the Council’s Housing Revenue Account (HRA) - the ring-fenced pot of money paid to the Council through rents which is used exclusively to pay for housing services.

Despite recent challenges such as the recovery from the Covid-19 pandemic, rising energy costs, increased inflation and interest rates and disruption to supplies of labour and materials, the council is committed to maintaining and improving tenants’ homes. 

The proposed rent increases would cover significant cost pressures, including:

• Materials and labour to repairs and maintenance
• Energy costs
• Borrowing costs due to rising interest rates
• Nationally agreed pay increases for our staff.
• Implementation of Scottish Government policies, such as climate change obligations and carrying out electrical checks on all our properties

The HRA is facing total cost pressures of just under £2.8million, which means that the proposed rent increase for 2025/26 will be higher than in some previous years. However, to reduce the financial pressure on our tenants, we will use some of our reserves to minimise the increase. These savings will not have any impact on the current service that is provided to tenants.

For the eighth consecutive year, tenants had the opportunity to vote on three different rent increase options, based on their priorities for investment.  

A total of 3,055 tenants responded to the consultation - the highest ever response rate,  compared to 2,944 last year.

A total of 64% preferred the 6% increase option, which would fund new and increased investment including:

• £20m over 5 years for buy back funding - to buy back around 40 ex-Council properties per year
• £17,000 for the Internet of Things household wi-fi sensors project
• £5,000 for the Housing Repairs out-of-hours service
• £150,000 for digital, financial & social inclusion projects
• £187,000 for increased staffing to meet compliance and service & maintenance
• £62,000 for a new Gypsy Traveller Project Officer
• £60,000 for a new Housing Enabler
• £15,000 for HRA roads & footpaths
• £105,000 for a Property Condition Resource - to undertake data interrogation and analysis to prevent damp, mould and condensation
• £181,000 for planned maintenance

The council is aware that some tenants may be struggling with the cost of living. A wide range of support measures have been put in place by the Housing Service to support anyone who needs help.

Housing and social wellbeing convener, Councillor Tom McEwan, said: “Firstly, I am very encouraged to see that so many of our tenants responded to the consultation on rent levels. This is one of the most important decisions that we make as a committee. We work right through the year in partnership with our tenants discussing what kind of housing services they want, and then ask what level of rent increase they want to see invested in those services.

“For the first time, over 3,000 tenants took part in the rent level consultation which is great to see. We are committed to giving tenants an influential voice in all the decisions we take about their services.

“We remain committed to maintaining rent levels that are affordable, while we maintain good performance and high levels of tenant satisfaction. This 6% increase means we would continue to have one of the lowest local authority rents in Scotland whilst being able to make important investments in Housing Services that our tenants have told us they want to see. We would also be the most affordable social housing option in Perth and Kinross by some margin.

“Our HRA is not immune to the rising costs that all businesses continue to experience, and the rent increase will also cover these increasing pressures.”

He added: “We know that for many people finances are challenging at the moment, and so affordability is vital when considering any increase in rent. We carried out an assessment and found that 87% of our residents could afford our proposed rents based on their income alone, without considering any housing benefit they receive.

“We have also put in place a wide range of practical financial help for anyone who needs it. Our Tenancy Sustainment Fund and ‘Think Yes’ locality team budgets are available to support our tenants. I would encourage anyone who is finding it difficult to pay their rent to contact us on 01738 476000 to take advantage of the financial support that Housing staff and other Council colleagues can provide.

“I would like to thank every tenant who has taken part in our rent setting process over the last 12 months. We will continue to work very closely in partnership with tenants to ensure we deliver high quality services for them.”

If the committee approves the proposed rent increase, it will come into effect from April 7th 2025.