by Daniel Jones
Councils around the UK have been urged to do all they can to build as many new homes for private rent as possible.
City law firm Addleshaw Goddard and the British Property Federation have teamed up to suggest that local authorities must do more to push through developments that will result in more rental homes.
Marnix Elsenaar, a partner at Addleshaw Goddard, told the Daily Telegraph: "It's vital that councils recognise both the need for an institutional private rented sector and that it's not the same as buy-to-let, while ministers should update planning guidance to make building for rent economically viable."
With so many people in the UK forced to rent rather than buy their home, it's important that a supply of available and suitable property is forthcoming.
Mr Elsenaar went on to note that once upon a time it was seen as more difficult to rent out residential property than commercial office buildings, but that has now all changed and places to live are in high demand.
A recent study by Knight Frank found a sixth of the country's population is now living in a rented property, with the number of tenants set to grow from four million in 2010 to 5.3 million by 2018.
The new Making Renting Viable report urged ministers to update planning legislation so that it's more economically viable for organisations to build homes that will be made available for rent.
Despite the UK's rental sector doubling in size in the last ten years, just one per cent of the stock currently on the market is owned by an institution. This is in stark contrast to other countries such as the US and Germany.
It could therefore be essential that more is now done to encourage organisations to build homes for rent, ensuring that there is plenty of supply for tenants in the years to come.
"Institutions want reliable, long-term returns and they see a good degree of income growth in the private rented sector," Mr Elsenaar added.
Published on: February 25, 2014