Outputs

Project: Target Rents

Target rents in relation to market levels

Target net rents for housing association properties are based on a mix of local earnings and individual property values. Although the formula is based on a 30:70 split, in absolute value terms the relative importance of capital values increases with market rents.

The average net rent was originally set in 2000 and has increased each year by the guideline of RPI+1% to 2002 and RPI +½ % thereafter. For these reasons it might be expected that over the years there might be increasing differences between target rents and observed market rents. This paper examines this question as well as providing a detailed description of how target and actual rents differ from one another by size and location.

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