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BPF to CLG Select Committee: Build-to-let solution to UK’s housing crisis

On the same day the government published its housing strategy the British Property Federation (BPF) told an influential committee of MPs that the only solution to the UK’s housing crisis is to encourage institutional investors, such as pension funds, to build-to-let.

Speaking at a CLG Select Committee evidence session into financing new housing supply, the BPF stated that institutional investors are already interested in housing and coupled with today’s political support and increased demand for rental properties, they could help meet the UK’s housing need.

The new housing strategy supports institutions building homes to rent through the release of land for sites and announcing an independent review of the sector in the New Year. Giving evidence this afternoon the BPF welcomed these changes but urged further initiatives.

Ian Fletcher, director of policy at the BPF, told the committee: “While many of the conditions are already in place, such as rental demand and now political support, the government face the challenge of firstly finding sufficient scale of opportunity, and also trying to encourage institutions which are unfamiliar with the housing sector to invest.

“Releasing public sector land could help solve the issue of scale. The vast majority of public land is held by local authorities, and there needs to be greater clarity on its release. Negotiating often complex and long-term deals with local authorities can be difficult, and perhaps the HCA could be introduced as an honest broker in tricky negotiations.

“Another vehicle that could encourage institutional investors and boost housing supply is residential REITs. They’d provide an obvious entrance into the market and an exit strategy, but officials are being a bit over cautious, particularly around issues such as the ability of a REIT to trade. Further discussions are required with the Treasury.”

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Patrick Clift, Media and Public Affairs Manager, on 07834 439 505 or at pclift@bpf.org.uk

Paul Sweeney, Media Officer, on 07841 732 194 or at psweeney@bpf.org.uk

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