A NEW affordable rent system linked to wages could help bridge the gap between people who cannot afford to rent homes but don’t qualify for social housing.

Cornwall Council is considering a new programme – Cornwall Living Rent – which would link affordable housing rent rates to local income levels.

This could create a new level of rents which would help those who are unable to get social housing but also struggle to pay rents charged for affordable homes and private lettings.

The council’s economic growth and development overview and scrutiny committee is set to consider the proposals when it meets next week.

A report going to the committee explains: “This new affordable housing product is aimed at those households with at least one person in full time employment, likely to be ‘just about managing’ financially and are generally renting in the private sector.”

Residents would be able to access either:

A rental product with a rental level that sits somewhere between social rent and affordable rent and will be more affordable than private rent;

A rental product that will allow households to pay a lower rent than they would in the private sector giving them the opportunity to save towards a deposit to then buy the property through a shared ownership route after four to five years.

The rates of Cornwall Living Rent would be calculated as being 30% of the average weekly wage – the recommended level of how much housing should cost according to the National Housing Federation.

Cornwall Council has calculated the average weekly wage for the lowest 25% of earners in each community network area to give an idea of what the rent levels could be.

The area with the lowest annual income among the lowest 25% of earners is Bodmin at £16,700. Their weekly income would be £320.

Under the Cornwall Living Rent a two-bedroom home would cost £96 a week and a three-bedroom home £106 a week.

St Agnes and Perranporth has the highest annual income for the lowest 25% of earners in Cornwall at £22,300 – a weekly income of £427.

So a Cornwall Living Rent in St Agnes and Perranporth would be £128 a week for a two-bedroom home and £141 a week for a three-bedroom home.

Under the Cornwall Living Rent scheme the average cost of a two-bedroom property would be £108 a week. This compares to £88 a week for a social rent, £120 for an affordable home and £150 a week for a privately rented property.

For a three-bedroom property the Cornwall Living Rent average would be £118 a week, compared to £98 for a social rent, £142 for an affordable home and £178 for a private rent.

The report going to the scrutiny committee states: “This proposal has the ability to support families containing children and young people by enabling their parents to rent a home that is more affordable than the private rented sector and can provide some households with the ability to save towards a deposit to access shared ownership if they wish to do so or to have more disposable income if intending to rent over the longer term.

"This should reduce financial stress on the families concerned. These types of schemes will also be offered on longer tenancy lengths than are generally available in the private sector as long as the tenancy is not breached, the family can settle in their home and become a part of their community permanently.”

Councillors on the scrutiny committee will be asked to support the use of community network areas for developing the new scheme and to support a pilot scheme to trial the concept.