The Housing White Paper in February this year signalled the Government's support for institutional investment into housing purpose built for market rent ("Build To Rent"). At the same time as launching the white paper the Government also launched its consultation into Build To Rent. The consultation period has closed as of 1 May and we, along with many others in the Build To Rent sector, have submitted a response.
The most significant limbs of the consultation are that it "proposes amending national planning policy to put further emphasis on Build to Rent; it also encourages an alternative approach to affordable housing exclusively for Built to Rent schemes, called affordable private rent."
We have submitted a response based on our experience as a dedicated supplier of specialist legal services to the Build To Rent sector; the soundings we have taken from clients and contacts within the industry; and on the basis of our firm belief that Build To Rent has a major role to play in contributing part of the solution to the housing crisis and adjustments to the National Planning Policy Framework (NPPF) should be encouraged where they assist the delivery of further Build To Rent stock but certain elements should not be rushed into where they have the potential to frustrate this burgeoning market. More specifically, our response:
- welcomes and supports the intention to make specific reference to Build To Rent in NPPF. This should encourage (or even require) Local Planning Authorities to consider Built To Rent as an appropriate product for delivery of new housing
- urges caution with the introduction of any formal nation-wide requirement for a long term Build To Rent covenant. Whilst a covenant should remain under consideration, the market should be given chance to develop and deliver without too much intervention, especially where it brings with it the risk of slowing institutional investment
- alternate tenancies and formal affordable rent products should also remain under consideration but imposing them now via changes to the NPPF risk making the Build To Rent investment opportunity less attractive to institutional investors. The market is growing rapidly and should be given time to demonstrate that it can deliver a major contribution to the housing shortage solution.
Tom Willows, Real Estate Partner, specialising in Build To Rent said: "The outcome of the consultation will be awaited with eager anticipation by many in the industry. At a time when investment in the sector is rapidly increasing, caution should be taken against interventionist policies which could slow down the rate of investment and therefore the rate of delivery of new housing stock."