Every year things tend to cost a bit more – inflation, materials going up in price, market prices going up, etc.
This means it costs us more to deliver the same services, which is why our charges typically go up as well. We don’t make a profit or pay dividends to shareholders. But we're a social business. Like other businesses we have to be financially responsible and cover our costs or (eventually) we’d be in trouble.
So how do we keep things affordable for our customers?
As we mentioned, we’re a social business, so making sure our customers can afford our services is very important.
When we calculate how much next year’s charges need to be, we apply a ‘Keeping things affordable’ cap on your service charges. This means your service charges won’t go up by more than £3 per week.
We don't pick the amounts for rents.
The way we set your rent is decided by the Government, and it may depend on what type of tenancy you have.
Generally, rents go up with inflation (Consumer Price Index, aka CPI).
There are different types of rents for different homes. But this would've been decided when your home was built.
We don't make a profit. The Government sets out how much rent we can charge, and we try to be as efficient as we can be.
Every year it costs us more to deliver the same services. For example:
- Prices go up with inflation
- Materials cost us more
- Our suppliers charge more, etc.
But we don't want to lower our standards, so we need rents to go up to match.
We're not like a normal business or a private landlord - it's not about putting up rents to make as much profit as possible.
But we do need to make the books balance, and we can't make a loss otherwise eventually we'd go bust.
There can be different rents for different homes on the same estate.
Most new B3Living homes are rented at 80% market prices. Sometimes we get grant funding which allow us to charge a lower rent (60%) on some homes within the same estate.
This is why we do a check with you before you move. We try to make sure you can afford the home you're nominated for. Your neighbour's situation might be very different to yours.
Because our rents are lower than the private market, it's likely that there will also be people on your estate, or nearby, renting from a private landlord who pay more again.
We get that paying a different rate to your neighbour won't seem fair. But there are a lot of things behind the scenes which affect how much rent we charge for each home. Often it isn't possible to charge everyone the same amount.
No we don’t.
We find they can make things worse rather than better. Rent-free weeks can be misleading - as you will pay more during the rest of the year.
When people are struggling to pay, it can help to have a routine.
Every year, before March, we look at how much we’ve spent in the year just gone. We also plan for any major work that we know is coming up.
This is what our new charges are based on.
We believe cutting our colleague's pay wouldn't help you as a customer.
We try to set a fair pay for all, so we can attract good people.
Regularly we look at similar jobs in the market and how much they are paid. Then we pay our people the middle of the going rate for their job. Some organisations will pay more than us.
We think this is a fair balance.
No one would want to stay being paid less than the average for their job. We want to attract good people to provide great services for you, but we must spend money wisely.
Paying a fair wage is really important for us as a social business - otherwise we'd be part of the problem! We pay something called the 'Real Living Wage' to make sure our colleagues can afford the cost of living.
How much rent we charge has an impact on the services we can/can't provide.
This year we invited you to give us feedback. Although nobody in our focus groups wanted a rent increase, they didn't want our standards to go down. Read more here
Our biggest cost is around repairs and maintenance (for every £1 rent, we spent over a third on maintenance). For example, over the past few years we've spent a £1million adapting homes for people with disabilities.
Our biggest cost is around repairs and maintenance (for every £1 rent, we spent over a third on maintenance).
It's likely we used loans to build your home in the first place - so we may we paying this back or covering the interest.
But we also use rents to invest in our community:
- To provide support when life changes and people need help. For example, we're bringing in a new customer coach.
- To fund/support local charities and services that help our customers - for example, Citizen's Advice, the Food Pantry.
- To build more homes to other people who need a home can come off the waiting list.