How to implement Social Rent convergence

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What is the consultation on?

This consultation seeks views on how to implement Social Rent convergence, as part of the government’s 10 year rent settlement for social housing.

This follows the broader consultation on future social housing rent policy that the government carried out between October and December 2024.


Scope of this consultation:

Following the previous consultation, the government announced (as part of the Spending Review) that there will be a 10 year rent settlement for social housing from 1 April 2026 in which rents will be permitted to increase by CPI+1% per annum.

However, the government received clear feedback in response to the previous consultation that the level of investment in new and existing social housing that is needed to deliver the government’s ambitions will not be unlocked unless Social Rent convergence is implemented.

Convergence would allow rents for Social Rent properties that are currently below ‘formula rent' to increase by an additional amount each year, over and above the CPI+1% limit, until they ‘converge’ with formula rent. Formula rent refers to the formula that is used to calculate the rent that may be charged for a given property when it is let to a new tenant. A convergence mechanism was originally introduced in 2002 but was scrapped in 2015.

The government therefore confirmed at the Spending Review that it will implement a convergence mechanism as part of the new rent settlement. The details of precisely how, and at what level, this mechanism will be implemented will be confirmed at Autumn Budget later this year, taking account of the benefits to the supply and quality of social housing, the impact on rent payers and the impact on the government’s fiscal rules. To inform that decision, this consultation focuses on how convergence should be implemented

Click here to find out more and complete the consultation.


Body/bodies responsible for the consultation:

The Ministry for Housing, Communities and Local Government (MHCLG)


Duration:

This consultation will close on the 27th August

Enquiries:

For any enquiries about the consultation please contact: socialhousingrents@communities.gov.uk

What is the consultation on?

This consultation seeks views on how to implement Social Rent convergence, as part of the government’s 10 year rent settlement for social housing.

This follows the broader consultation on future social housing rent policy that the government carried out between October and December 2024.


Scope of this consultation:

Following the previous consultation, the government announced (as part of the Spending Review) that there will be a 10 year rent settlement for social housing from 1 April 2026 in which rents will be permitted to increase by CPI+1% per annum.

However, the government received clear feedback in response to the previous consultation that the level of investment in new and existing social housing that is needed to deliver the government’s ambitions will not be unlocked unless Social Rent convergence is implemented.

Convergence would allow rents for Social Rent properties that are currently below ‘formula rent' to increase by an additional amount each year, over and above the CPI+1% limit, until they ‘converge’ with formula rent. Formula rent refers to the formula that is used to calculate the rent that may be charged for a given property when it is let to a new tenant. A convergence mechanism was originally introduced in 2002 but was scrapped in 2015.

The government therefore confirmed at the Spending Review that it will implement a convergence mechanism as part of the new rent settlement. The details of precisely how, and at what level, this mechanism will be implemented will be confirmed at Autumn Budget later this year, taking account of the benefits to the supply and quality of social housing, the impact on rent payers and the impact on the government’s fiscal rules. To inform that decision, this consultation focuses on how convergence should be implemented

Click here to find out more and complete the consultation.


Body/bodies responsible for the consultation:

The Ministry for Housing, Communities and Local Government (MHCLG)


Duration:

This consultation will close on the 27th August

Enquiries:

For any enquiries about the consultation please contact: socialhousingrents@communities.gov.uk

Page published: 10 Jul 2025, 03:06 PM