House builders are being offered a share of a new £400 million government investment scheme, to help encourage the building of new homes specifically for private rental. Now for the first time, the government is offering support for developers and investors looking to move into the private rental market.
Housing Minister, Mark Prisk recently said this new ‘Build to Rent’ scheme, will encourage people to invest in the untapped private rental market and offer a better choice and quality of homes for those looking to rent a home. Whilst acknowledging the housing market was “turning the corner” he said: “I want to go further, which is why I’m inviting bids for a share of up to half a billion pounds to help build a bigger, better private rented sector.”
Bids for the Build to Rent fund should support longer tenancies and provide a good mix of accommodation as the government is aiming to offer more choice and flexibility to private sector tenants under the scheme.
Mayor of London Boris Johnson commented: “By releasing land and working with institutional investors we are working hard to accelerate delivery in the purpose built private rented sector. I welcome this fund which will not only provide more homes for working Londoners, but also deliver much needed construction jobs and will underpin this city’s future economic growth,”
House builders and investors have until 31 October to submit their expressions of interest and investment proposals for short-listing by the Department for Communities and Local Government, the HCA and the Greater London Authority.
Build to Rent is funding (subsidising) and promoting the private rental sector to the benefit of companies and investors, whilst at the same time the government has cut the level of funding to public sector housing associations by 65% since 2010. In April it also brought in changes to planning rules that have allowed house builders to challenge the legal requirements for low cost, affordable housing on their projects. Many have done so resulting in fewer homes to rent being built on their developments.