The Department of Infrastructure is changing the mechanism for setting public sector housing rents across the Island. This will apply to both DoI Housing Agency tenants and Local Authority housing tenants. 

Starting in April 2026, annual rent adjustments for more than 6,200 public sector properties will be directly linked to the previous year’s September Consumer Price Index (CPI). The expected annual increase will be the September CPI rate with an option for housing organisations to add 1% more at their discretion. 

Previously rent increases were determined by the DoI following representations from Local Authorities, however this process was not considered transparent enough, with no clear guidance about the rationale used for setting the rate. 

Furthermore, Government has been moving towards an annual uplift of fees and charges across all government services, usually linked to the relevant index, in this case CPI. 

The proposed change aims to modernise the rent-setting process by aligning annual increases with the Island’s economic conditions while improving financial predictability for both tenants and landlords. 

Consultation with housing providers about changing the rent-setting process has been ongoing since 2022. This new approach was well received at the recent Local Authority Housing Conference, and further engagement is planned for future rent reforms. 

To assess the potential impact before changing the mechanism, the Department looked at what would have been the impact of this rent rise mechanism if it had been applied for the last 14 years. 

The analysis showed that the average annual increase would have remained largely unchanged. If during that period all landlords had chosen to apply the optional additional 1%, the overall difference would have been just 0.2% higher than the current situation. However, a scenario where all landlords chose to impose the extra 1% rate every year is considered unlikely. 

A key feature of the policy is a safeguard clause: if inflation spikes and proposed rent increases were untenable, the Department has retained the ability to intervene and set a lower rate. The policy aligns more closely with the Housing Act 1955, which requires regular rent reviews and Departmental approval for changes. 

Many benefits from Treasury’s Social Security Division are set with reference to the September CPI, and aligning rents with this mechanism will ensure that the increases are affordable for tenants on minimum or living wages. 

Housing Authorities will be required to notify both the Department and tenants of their decision to utilise any discretionary increases, and all tenants will receive formal notice of their new rent levels ahead of the 2026 financial year.

Port Erin Commissioners resolved at its meeting in November 2025 to add the discretionary additional 1% to the CPI uplift in rent from April 2026.    

Added 2 December 2025