Partners across the local authority and housing association sectors have commissioned Savills to undertake analysis of the impact of the Government’s proposed future rent settlement. 

The analysis shows that a CPI +1% rent increase for 10 years along with a policy of rent convergence for rents that have fallen below the ‘Formula rent level’, will enable local authorities to break even over the longer-term period, but will leave significant shortfalls in the short term. It will also not leave any capacity for local authorities to fund new build at scale within their Housing Revenue Accounts.  

CPI +1% (+ convergence) needs to be part of a wider sustainable financial settlement for local authorities.