Future For Consumers Is Build To Let Says BPF

Leading figures from the property industry outlined how changing attitudes to renting and developing a branded build to let sector could be a vital component in meeting government housing targets and giving consumers the quality homes they want.

Industry figures from the British Property Federation (BPF), Grainger, Unite and CB Richard Ellis, believe a large-scale branded rental sector to mirror Germany or Holland would be the shot in the arm needed for UK housing. A government review due on 23 October is expected to initiate a step change in how rental is perceived.

In the first half of the twentieth century, major institutions such as Prudential, Norwich Union and Standard Life owned huge swathes of rented properties. However, now the sector represents just 11% of total UK housing stock.

Speaking at the Resi conference in Newport, BPF Chief Executive Liz Peace said that for consumers, being able to rent fairly priced and good quality homes would be vital in meeting the demand of those unable to afford or not wanting to buy.


She said: "The commercial property industry is well placed to use the same techniques it has used so successfully in commercial property development and management to create a professional, branded rented sector, which would have the added advantage, over time, of driving bad landlords out of business.

"The key is to get the financial returns we need, which requires changes to the tax and regulatory framework. The business philosophy of building to scale and generating an income stream can work. At the moment, central government has been politely interested, but officials need a lot more convincing. If we can build relationships with local authorities we could go forward directly with them."

No legislation is currently needed for councils to incentivise the delivery of build to let.

"We don't need legislative changes for local councils to say 'we want this plot for build to let'," she added. "If we could get some big residential vehicles going, it would soak up some of the surplus residential stock and also help to get the house builders building again. It's a win-win situation if we can get things going."

Mark Allan, Chief Executive of student housing developers, The Unite Group, which has 37,000 units across 29 cities, said:

"Every cloud has a silver lining. In terms of build to let, it's clear when you look at new building start figures that we're not going to get to the government’s targets just using the house builder model. There's a fantastic opportunity to discover what build to let can bring. We need to remember there is a very significant proportion of people renting because they want to rent. Students are probably the most visible of those but we can take the lessons learned further a field, by identifying others who want to rent. We build and manage entire properties. We build something with management in mind and design it for our customers, to be run for many years."

(CD/JM)