New Era estate could means-test residents to set individual rents
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Version 0 of 1. The richest tenants on an east London housing estate could be asked to pay more than double their neighbours’ rent, in an experiment to stop the poorest from being forced from their homes. The new owners of the New Era estate in Hoxton want to means-test residents to avoid the break-up of the 93-home community, which last year successfully campaigned against mass evictions and tripled rents proposed by US investor Westbrook Partners. Related: New Era residents toast Christmas victory after charity buys London estate Dolphin Living, a housing charity, bought the estate in December following a residents’ uprising against Westbrook’s plans backed by the comedian Russell Brand. The new landlord’s proposal is effectively a test of neighbours’ altruism, because it asks the rich to pay more than the poor to keep the community together. It has, however, already caused arguments between residents, some of whom would see their rents more than double while others would enjoy a cut. Jon Gooding, Dolphin’s chief executive, said: “You will have people paying entirely different rents for identical accommodation and there will be families with three children paying less for a big flat that a couple in a small flat. “That feels counterintuitive, but it makes sure that no one would have to leave the estate because they couldn’t afford to live there.” Previous landlords have kept down the rents of the private homes, a mile north of the City: they are now typically half the market rates in an area in which rents have soared. Gooding admitted concerns about how the means test could work in practice. “We don’t want this to end up like some sort of Russian novel with people informing on each other [about their earnings],” he said. Lindsey Garrett, a resident who led the campaign against Westbrook, said there had been quite a lot of argument about the idea on the estate. “A lot of people are saying it is not fair they will be paying more than they were,” she said. “But from where I stand it is hard to argue against it. If you’re earning £60,000 a year maybe that’s what you should pay.” She said married neighbours who together earn around £60,000 were strongly opposed to the idea, but the majority on the estate appeared to support the plans. Dolphin has proposed means-testing residents every three years through payslips and bank statements to set individual rents to guarantee that every resident can afford to pay and be left with a pre-determined minimum disposable income. One example given at a meeting last week showed that tenants with a household income of £21,000 a year would pay the same rent as they do now, while neighbours bringing in £66,000 and with the same household composition would pay more than double. Gooding said: “If we can make this work, I think the New Era tenants will have achieved something even greater than they achieved so far [by seeing off Westbrook Partners], because they may have achieved an exemplar which others will follow.” The means testing will not be compulsory and a default rent would be charged to those not wanting to reveal their earnings. Dolphin is seeking residents’ ideas and has asked them to decide how much of a tenant’s pay rise should be taken as rent, how much financial information it ask can for, and whether those who choose not to be means tested should pay market rent. Campaigners for more affordable housing said the idea would only temporarily solve the problem. “It will work until Dolphin runs out of money and then the subsidy will stop,” said Alex Hilton, the director of the campaign group Generation Rent. “The real test will be what they do when someone moves out. There will be an incentive, not just for the landlord, but for the tenants to get a higher rent payer in. It is unsustainable.” Gooding said Dolphin was committed to prioritising the lowest-income households when empty flats came up and that people earning over a certain amount would have to either pay market rents or even move out. Dolphin hopes to agree the new system this spring before bringing it into effect in 2016. |