I escaped homelessness and then Lambeth council raised my rent by £470

I have been homeless for two years, living in temporary accommodation supplied by Lambeth council. Finally last month my dreams came true; I successfully bid for a council flat. The rent was advertised at £121.64 a week and I duly signed the contract and paid the first week in advance. However, a week later, my online account showed I was in arrears. I rang the council, which told me there had been a mistake and my rent was actually £130.69 a week. For a disabled person on a very low income, an extra £470 a year is a lot of money.

My housing officer told me I had to sign a new contract reflecting the amended sum immediately and that as the council had made a mistake, it could legally increase my rent without due process.

This doesn’t sound right to me, but I’m terrified of trying to fight the council because I’m on an introductory tenancy. In the words of my housing officer, “it’s very easy for the council to evict you”. A return to homelessness is my worst nightmare. The council’s stance is that my benefits will cover the higher rent. In fact, I’m not currently receiving the housing element of universal credit to which I’m entitled, because the rent on my contract differs from the sum on the council’s system. Moreover, now I am housed, my aim is to increase my work and come off benefits. I’ve contacted various charities, but no-one has the capacity to help me.
CPL, London

This is the council that last year threatened tenants with eviction if they could not afford a 350% increase in energy bills charged as part of their rent. Its conduct towards you defies belief. Your flat was listed with a weekly rent of £121.64 for three months on the council portal and yet just five days after you signed the contract it discovered its “mistake”.

It’s immaterial whether the difference is covered by benefits or not; a legal contract cannot simply be ripped up when one party decides it miscalculated. Following representations from your support worker, officials declared magnanimously that they would hold off enforcing the “correct” sum until the end of the financial year in April. It’s in April that across-the-board rent increases happen. The government cap on how much social housing landlords can increase rents is the consumer price index plus 1% which, this financial year, amounts to 7.7%. If, as you fear, this is applied on top of the 7.4% “correction” you could be facing a double whammy of more than 15%.

This contravenes the government’s social rent policy, which states that social landlords must adhere to the cap even if, for whatever reason, a rental charge is below the usual rate. It can only be adjusted to the going rate once the tenancy has ended.

I asked Lambeth if it proposed applying the annual capped rent increase as well as amending your current charge in April. Ducking the question, it told me: “Because of an IT glitch, [CPL] was provided with incorrect rent details, and we apologise for the frustration and inconvenience this has caused. As a result of this being brought to our attention, we have agreed to honour the agreed rent of £121.64 per week for the remainder of this financial year. The rent will be adjusted to reflect the correct amount from April 2025.”

I turned to an expert in property law, Giles Peaker of Anthony Gold Solicitors. “The tenancy agreement is a binding contract on both parties,” he said. “It is not possible for the council to unilaterally decide to change the rent in this way, nor to force the tenant into a new agreement. It may have been an error on the council’s part, but unless that error would have been obvious to the tenant, which is clearly not the case, the council are stuck with the rent level that was agreed. That will also be the base rent for future increases, which are set by the government.”

I put this to the council and the tone instantly changed. This time it declared that your contract would not be voided and you would not be charged the higher sum after all. Your payments will rise in April but only in line with rent rises across the borough and subject to the government cap. The percentage rise will be calculated on the £121.64 you signed up to.

However, in the unlikely event Lambeth’s price rise is lower than the cap, it will use the headroom to claw back some of the difference between the contracted sum and what it deems the “correct” one. Extraordinarily, it claimed there had not been a U-turn, despite correspondence to you and to me suggesting the complete opposite.

It tells me it is now checking all rental agreements to minimise the risk of future errors. If Lambeth does try to alter your contractual agreement, you – and any other social housing tenant – can appeal to the housing ombudsman. A court, according to Peaker, is also likely to take a dim view of such a breach of contract.

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