Time to bring in the institutions

AN institutionally funded build-to-let sector could deliver the funding needed to develop quality residential accommodation for longer-term rental, which would also serve to stabilise the housing market – according to the British Property Federation.

Responding to Gordon Brown’s statement to the House of Commons regarding the contents of the upcoming Queen’s Speech, Liz Peace of the BPF said: “Of course we need more housing, but a new source of funding needs to be found, as we've seen numerous house builders unable to meet targets because they can't sell the units they have.

She argues that government should encourage institutions – such as pension funds – to

invest in long term solutions.

“This can be done with planning reform, to recognise rental development in its own right, and through widening the scope of affordable housing. Current measures are too prescriptive and the system means that too many vulnerable people are missing out,” she said.

“Private investors cannot afford to buy, meaning that buy-to-let cannot expand, despite growing demand for rental accommodation from migrants, students and young professionals.

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We need to destigmatise renting, and put an end to people borrowing beyond their means to get onto the housing ladder when there may be better options.”

Ministers should also attempt to lower the barriers to entry to real estate investment trusts (REITs), Ms Peace concluded.