Southwark Council is asking residents for their views on a proposed 4.5% rise in council rents from April 2027, with some tenants potentially paying up to a further £1 a week as the borough brings lower rents closer to a nationally calculated level.
The plans also cover service charges, garages and communal heating. They are proposals for the 2027–28 financial year, not changes that have already been agreed. The council’s Executive will consider the responses before deciding the final charges.
On 11 November, the executive member for council homes agreed that the proposals should go out for resident engagement. That decision is subject to the council’s call-in process and is due to take effect on 19 November if it is not called in. The separate decision on final rent and charge levels is still to come.
How the proposed rent rise would work
The proposed general increase is based on the annual rate of Consumer Price Index inflation in September, which was 3.5%, plus one percentage point. It would apply to council-owned and tenant management organisation homes in the Housing Revenue Account, including applicable hostel rents.
There is a second element for eligible homes whose rent is below what is known as formula rent. This is a level calculated using factors including local earnings, property values and the size of a home. The proposed additional increase of up to £1 a week is intended to move those rents gradually towards that level.
The extra amount would be on top of the general increase and could not take the rent above the applicable formula level. It is not a flat £1 charge for every tenant. The council estimates that around 34,000 tenancies will be below formula rent on 1 April 2027, but the amount of any additional increase would depend on the individual rent and the remaining gap.
National policy allows social landlords to use this process, called rent convergence; it does not require Southwark to impose the extra amount. The national allowance rises to up to £2 a week from April 2028, but that is not a decision by Southwark to apply a particular increase in a later year.
The council estimates that the borough-wide average weekly rent would move from £136.97 in 2026–27 to £144.05 in 2027–28, an increase of £7.08. Those are averages across the council’s homes. They reflect changes in the mix of properties, new lettings at formula rent and convergence as well as the general increase. They should not be treated as a prediction of the increase for an individual household.
Charges beyond the rent
Service charges are separate from rent and depend on the services provided to a home, block or estate. For the four communal services in the proposal, the combined weekly amount would rise from £15.15 to £15.45. Cleaning would account for 23p of the 30p increase and grounds maintenance for 7p. The proposed charges for communal lighting and door-entry maintenance would be unchanged.
The sheltered and flexi-care service charge would rise from £42.32 to £42.57 a week. Larger percentage increases are proposed for service charges at three supported hostels: 30.5% at Keyworth, 23.8% at Wren and 18.3% at Northcott. These are service charge proposals for those facilities, not percentage increases to every council tenant’s rent.
For garage users, the standard weekly charge would rise from £27.30 to £29. The concessionary rate for Blue Badge holders would increase from £22.30 to £24, while the small-sites rate would go from £15 to £16.
The heating proposal differs according to the type of home and meter. Tenant charges for unmetered heat networks would be frozen, as would the borough-wide tariff for older homes fitted with heat meters. A higher tariff is proposed for metered new-build homes. For an average user in a one-bedroom new-build home, the council estimates an increase of about 6.6%; actual charges would depend on heat use.
Why the council is consulting
The Housing Revenue Account is a separate, ring-fenced budget for council housing. Income from rents and charges helps pay for housing services and investment in homes. The council says higher construction and borrowing costs, an ageing housing stock and safety requirements are placing pressure on that budget.
Its figures show an overspend of £1.4 million in 2025–26 and a forecast overspend of around £0.4 million in 2026–27. The council says the proposed additional income would support repairs, building safety, estate services and investment. Higher charges would also affect household budgets, although Housing Benefit or Universal Credit may help eligible tenants depending on their circumstances.
The online survey is open until 11.59pm on Saturday 28 November. Residents can also attend an online meeting on Monday 16 November from 6pm to 7.30pm. The council’s timetable provides for feedback to be considered by the Executive between December and January, with notices of any final changes to follow before the new rent year begins in April.
