How we set your rent and service charges

Social rent or ‘Formula Rent’ is initially set using a calculation outlined in the Government framework. The aim of the framework is to make the process of setting rents across the country impartial and linked directly to the value of the property you live in, the number of bedrooms and the average earnings within the region.

The current government rules state that social rents can be increased by the previous September’s Consumer Price Index (CPI) plus 1%.  The CPI in September 2022 was 10.1%, plus an additional 1%, meaning an increase of 11.1%.

For 2023/24 the Government has capped the amount Registered Social Landlords are able to increase their rents to 7% so we will be applying this to your existing rent charge for the period from April 2023 to March 2024.

The Government framework outlines the calculation to initially set an affordable rent, which equates to approximately 80% of market rent for a similar property within the area. This rent will then be increased or decreased each year dependent upon the Government guidelines at that time.

The Government guidelines for calculating any rent rises include a ‘cost of living’ increase, set using the Consumer Price Index (CPI) measure of inflation, which in September 2022 was 10.1%, plus an additional 1%, meaning an increase of 11.1%. For 2023/24 the Government has capped the amount Registered Social Landlords are able to increase their rents, to 7%.

However, in these difficult financial times and in order to help with the current cost of living, we will only be applying an increase of 5% to your existing rent charge for the period from April 2023 to March 2024.

Shared Ownership allows you to buy a share of a property and rent the remaining share from us. The amount of rent paid is dependent upon the share that you own. For example, if you had purchased a 60% share you would only be charged rent on the remaining 40%.

Rather than a tenancy agreement, shared owners have a lease. This lease outlines the responsibilities on both the shared owner and us. The lease also sets out how the rent will be reviewed. Although leases may vary the rent calculation tends to allow for an annual inflationary increase + 0.5% each year.

Fair rent applies to a tenancy that began before 15th January 1989. The rent is calculated independently by the Valuation Office Agency every 2 years.

The rent that Valuation Office Agency register is the maximum that can be charged until the rent is registered again.

It is possible that we may review the amount that we are charging you on the first anniversary of the registration but this amount will never be greater than the registered rent.

Service Charges are the costs involved in providing a service to a property, estate or scheme, such as caretaking, lift maintenance or communal gardening. Some service charges may be personal to you, such as personal heating and hot water, water rates or home contents insurance. With the exception of affordable rent tenancies, we will inform you if your rent includes a service charge and how much this service charge is in addition to the rent that you are being charged.

Depending on your tenancy or lease agreement, service charges are calculated either by where you live and the actual costs of delivering the services you receive, or under a fixed service charge regime, meaning we estimate how much it will cost to deliver the services to your home and estate.

Your tenancy or lease agreement states which services you receive. Depending on the kinds of service charges you receive, these may change on an annual basis. You will receive notification of any changes to your service charges with your rent review notification.

Housing benefit and Universal Credit cover most communal charges but NOT any charge that is personal to you.

The Government guidelines for calculating any rent rises include a ‘cost of living’ increase, set using the Consumer Price Index (CPI) measure of inflation, which in September 2022 was 10.1%, plus an additional 1%, meaning an increase of 11.1%. For 2023/24 the Government has capped the amount Registered Social Landlords are able to increase their rents, to 7%.

You can read more about the Government’s adjustment of formula rent here>>

Like many housing providers across the country, Jigsaw Homes is applying a rent increase for 2023/24 to enable us to meet the increased costs of delivering services and maintaining our homes.

The decision was taken by Board members following detailed analysis and discussion of the options available.

For the majority of tenants, this will take effect from 3 April 2023 and for others this will be applied in October 2023.

At your rent review date, you will receive details of your rent and service charge for the coming year. When you receive this, it will tell you when the increase will take place, by how much and any steps you need to take.

We always aim to keep rents as affordable as possible.  We have to balance this aim with the rising costs of repairing and maintaining homes and other essential goods and services.

The rent increase will enable us to meet the increasing cost of maintaining homes, delivering services and investing in new and existing homes, now and in the future.

Any money we make goes directly back into repairing and maintaining homes to ensure they are safe and of good quality, funding vital services and improving the energy efficiency of homes to reduce fuel bills and work towards national zero-carbon targets. It also helps us deliver much-needed new homes to help tackle the lack of affordable housing.

If you are paying by Direct Debit , we will make the necessary alterations to your Direct Debit. Once this is done, you will receive a letter notifying you of the payment amounts and the dates this money will be taken from your bank account. Direct Debit is our preferred method of payment.

We also provide an online benefits calculator on our website – https://jigsawhomes.entitledto.co.uk/ – which can be used to work out whether you are entitled to benefits based upon your current income.

As long as your circumstances have not changed, if you are entitled to Universal Credit housing element and Housing Benefit you should find these are increased to cover the increased rent and any service charges.

If you are claiming Housing Benefit, we will inform your Local Authority Housing Benefit Department of your revised rent and service charge. It is your responsibility to ensure your Housing Benefit is paid at the correct rate.

If you are claiming Universal Credit, you will need to notify the Department of Works and Pensions (DWP) of any changes to your rent and service charge. The association is unable to do this on your behalf. Depending upon your Universal Credit claim, you can do this by:

• Updating your journal, if your Universal Credit claim is solely managed online
• contacting Universal Credit on 0800 328 5644
• providing a copy of the rent charge letter to DWP/Job Centre Plus

We understand that with wider increases in living costs and the financial pressures of the pandemic, that this may be a difficult time, so if you are worried that you might not be able to pay your rent, you should contact us immediately.

We offer help with benefit entitlement, debt and other financial advice through our dedicated Money Advice Service. This is a free and confidential service that might help increase household income, or make better use of it. You can call our specialist team on 0300 111 1133 if you are a Jigsaw Homes North tenant, 0300 011 1144 if you are a tenant with Jigsaw Homes Tameside/Jigsaw Homes Midlands. Miles Platting tenants can call us on 0800 234 6826.