Tower Hamlets loses High Court fight to stop low rents hitting 80pc level

Tower Hamlets Town Hall

Tower Hamlets Town Hall - Credit: Archant

Housing chiefs in London’s deprived East End with its long housing waiting list have vowed today to continue fighting for lower rents on new properties—after a High Court ruling against them.

A judge today dismissed an attempt by Tower Hamlets council and eight other local authorities to stop Boris Johnson imposing a limit on how low rents can be set on new properties.

It means social rents must be set at 80 per cent of the London market rate when new properties are completed.

“This is disappointing,” said Cllr Rabina Khan, Tower Hamlets cabinet member for housing. “The rent levels that residents can afford doesn’t match the policy being put forward by Boris Johnson.

“But the High Court ruling allows us to continue to fight for lower rents on individual developments—and we will.”

The nine councils, which also include neighbouring Hackney and Greenwich as well as Camden, Brent, Enfield, Islington, Lambeth and Southwark, argued that they should be allowed to set their own lower rent limits.

Anywhere close to 80 per cent of market levels would be “unaffordable for many families,” they pointed out.

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Local authorities until now have been able to insist on social rents that are typically around 30 to 40 per cent of market level in inner London.

The High Court judge ruled that the Mayor of London had acted within his executive power—but his proposals leave it open to each local authority to fight for lower rents on individual housing developments, particularly those not funded by City Hall.

Tower Hamlets Mayor Lutfur Rahman said: “There is a fundamental need to ensure that ‘affordable rent’ is genuinely affordable. We’ll continue doing what we can to make sure families have suitable housing.”

The housing waiting list for families in the East End is well over 20,000.

Boris Johnson’s 80 per cent rent rule applies only to new housing schemes. Existing council and most housing association tenancies are unaffected.