The ONS have released the September CPI which forms the basis of annual rent increases for 2024/25. Today’s inflation figure is higher than predicted at 6.7%. Last year when the September 2022 CPI was 10.1% the following year’s rent increase was capped at 7%.  

So, the question is will the 2024/25 rent increase be 7.7% (ie, CPI + 1%) or will there be another rent cap? 

Many of you may have already commenced some work around this, key considerations here are:

What is the financial position on the CPI+1% increase of 7.7%

  • What is the position if the increase was 7% on the basis of the Government intervention last year – this is highly possible
  • What is the position if the increase was capped at 5% – we are expecting CPI to reduce and with the election next year may see this approach adopted
  • Would the board be requested to review a different increase amount – if yes, what is the rationale and what is the board appetite around this.

This issue will be raised at HQNs stress test event next week on 26 October 2023 – please see the link to the programme below:

https://hqnetwork.co.uk/events/sector-risk-and-stress-testing-in-2023-how-to-get-it-right/

Our next quarterly rents forum is on Wednesday 14 November from 10.30am – 12.30pm where we will be discussing which approaches are being considered. Also, on the back of the conference we would also like to her from/discuss whether any organisation are adopting new approaches to involve and engage customers.