How we set your rent and service charges
MHA is a social business with rents as the primary income stream. We don’t make profits for shareholders and our income pays for the homes and services we provide. Our ‘income and expenditure’ pie charts give a detailed breakdown of both how we spend out money and our sources of income. The costs of our services and building new homes typically increase every year, and we apply an annual increase to the rent to ensure we can continue to provide safe homes and quality services.
Frequently Asked Questions
How is rent set in Wales?
Each social landlord, be that a local authority or a housing association, is responsible for setting their own rents, but within a cap set by the Welsh Government, as outlined in their Rent and Service Charge Standard
In autumn 2023, the Welsh Government announced that the maximum increase that can be applied to social housing rents for 2024/25 will be capped at 6.7% overall.
If you are interested in reading more about the reasons for this uplift and how it will be applied, have a look at this useful article written by Welsh Housing Quarterly: https://whq.org.uk/2023/10/27/minister-caps-social-rent-rise-at-6-7-next-year/
So how do MHA decide what rent to charge?
It is then up to each HA/LA to set their own rents in line with their ‘Living Rent’ model. MHA’s Local Rent Setting Policy was introduced in 2021 to ensure affordability and fairness of rents.
We consider the following when setting rents:
- Obligations to Welsh Government related to rent setting
- MHA’s financial business plan and annual budget setting
- MHA’s rent setting policy
- Tenant feedback on affordability (based on Tenant Satisfaction Survey)
- Analysis of current rents using affordability tests such as: analysis of local income and earnings levels and analysis of local market rents
- Property type/size/location
- Applicable service charges
The model works on the principle it’s unaffordable for tenants on a low income to spend more than a third of their income on their rent and that maintaining a link between rent setting and affordability is critical for social rents.
MHA’s Local Rent Policy does not apply to intermediate and market rent properties.
What will be MHA' rent increase for 2024/25?
For 2024/ 25 MHA will be increasing rents overall by 6.6%. Following the Living Rent model those rents which are currently above the Living Rent will be frozen and those below Living Rent will be capped at 8%.
Some tenants will see an increase in their weekly rent in line with the Welsh Government guidelines, and some tenants will have no increase on their rent this year. This will depend on how near to the newly calculated Living Rent your current rent is. Our goal is that eventually every rent will be set at the Living Rent levels.
Your personal rent letter, which you will receive in January 2024, will tell you how much you need to pay from April 2024.
To read more about the Living Rent model > MHA1258-Rent-Letter-Flyer-Digital.pdf (monmouthshirehousing.co.uk)
What about my service charge?
Service Charge increases are calculated on quotes received from suppliers or estimations based on last year’s actual cost and including a % uplift. This will usually be linked to CPI. Service charge increases and an explanation of these can be found on your annual rent increase letter.
When do the new rents and service charges apply?
New charges will apply from 1st April 2024, and you will be notified of the change by letter two months before the increases apply.
What do I need to do if I receive Housing Benefit?
If you are in receipt of Housing Benefit, MHA will notify the council of any increase that may be applicable, who will then contact you separately.
What do I need to do if I pay by Universal Credit (UC)?
If you are in receipt of UC you will need to report any change with your new rent details to the Department of Work and Pensions on or after Monday 1st April 2024. MHA will be in contact with you regarding this process and can provide support if required.
What do I need to do if I pay by Standing Order?
If you pay your current rent by Standing Order and there are any changes to your rents or service charges, please instruct your bank to pay the amount for rent and service charge due from Monday 1st April 2024.
What do I need to do if I pay by Direct Debit?
If you pay by Direct Debit, we will make any necessary adjustment to your payments and notify you in writing. Please note that you need to pay your rent and service charge a full week in advance as stated in your tenancy agreement.
Will I still have rent free weeks?
Yes, as 2024/25 is a leap year there will be three free weeks for 2024/25. These will be applied on the weeks commencing 9th, 16th, 23rd December 2024
If you pay monthly the calculation will take into account the 3 rent free weeks, so you pay the same each month of the year. Basically, you will benefit from the 3 free weeks by paying less rent each month.
If there is a debt on your account, it is your responsibility to keep to your arrangement by paying through the rent-free weeks. This will help reduce your debt quicker.
Help and support
We are here for you.
We appreciate that it can be hard to make ends meet and MHA want to support you to continue to pay your rent, so please don’t suffer in silence.
If you are struggling to make payments, MHA has several ways we can support you from giving advice on energy efficiency, claiming the right benefits, budgeting, and seeking employment to access to emergency payments.
We have lots of tips and advice on support available in our Cost of Living Support section.
Additional support & advice
Welsh Government: Here to help with the cost of living | GOV.WALES
Monmouthshire County Council: HOUSING SUPPORT – Monmouthshire
StepChange Debt Advice: StepChange Debt Charity. Free Expert Debt Help & Advice
Get in touch
Your income officer will be able to help you access the right advice and support. Just call 0345 677 2277 and ask to speak to your Income Officer.