How is my rent increase calculated?
Your rent will increase each year in line with the increase in the RPI plus 0.5%. The RPI or retail price index is a measure of inflation published by the office for national statistics. In short your rent is increased in line with the inflation of the pound, plus an extra 0.5% of your current rent. We know this can sounds like a minefield and leave you wondering what this will mean for you.
As an example, if the rate of inflation next year is 1.9% (this is the 10 year average but can differ each year) your increased rent calculation would look like this based on a monthly rent of £200:
1.9% of £200 - £3.80
0.5% of £200 - £1.00
Total rent increase: £4.80
New monthly rent amount: £204.80