Key workers who a housing association pledged to protect when it bought up their Hackney estate have said spiralling rents have priced them out of the area.
When the Crown Estate, a private agency which manages property notionally owned by the Queen, announced it would sell the houses near Victoria Park four years ago, residents mounted a campaign to ensure rents would remain affordable.
After months of heated debate Peabody bought the terraced houses in Gore Road, South Hackney, in January 2011, along with other Crown Estate homes – and pledged to keep the homes affordable.
At the time, Stephen Howlett, chief executive of Peabody, said: “We are absolutely committed to keeping these homes affordable and available to the key workers who are so crucial to London’s economy and quality of life, and we look forward to welcoming these fantastic communities into the Peabody family.”
But the victory has proved bittersweet for residents, who say some of the houses are sitting empty because key workers cannot afford them.
Tenants have now started a new campaign, complaining key workers like nurses, fire fighters and police officers, who have not had a pay rise in four years cannot afford the rent increases imposed by Peabody.
Teacher and Gore Road resident Jamie Duff said: “They’ve put up rents by 36 per cent over four years.
“They said they were going to look after the needy poor hardworking Londoners who can’t afford to live in London, but in reality they are driving up the rents to the point they aren’t affordable.”
Mr Duff compared the situation to that faced by tenants on the New Era estate where new landlord Westbrook Partners bought the estate and has threatened to bump up rents, but said that Peabody, which is supposed to be a charity, was doing the same thing.
Rents are capped at 60 per cent of market rent, but MP for Hackney South and Shoreditch Meg Hillier said that private market rents were so high that even that percentage was too much for key workers.
“When it was sold we really pushed for it to be key worker housing. There’s a real danger we are going to be hollowing out London,” she said.
“We are meeting Peabody to discuss that again. What I would say in their defence is no one could predict how much private rents would go up in Hackney. We are going to urge them to relook at the model.
“If even the key workers you are aiming at can’t afford it something is wrong with that model.”
Residents handed in a petition to the Greater London Authority last week, arguing that affordability should be based on people’s incomes rather than escalating house prices.
A spokesman for Peabody said rent increases next year would be lower than in previous years, and that they had been discussed with resident representatives as part of its commitment to “open dialogue”.
He said: “Since our acquisition Peabody has invested more than £7m in these properties, delivering on our promise of quality homes for Londoners. And we intend to invest a further £6.6m in the coming years.
“We are investing in these homes and it is key worker housing not social housing.”
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