RESI 2013: Government rules out private rented sector use class

Speaking at Property Week’s RESI conference today, housing minister Mark Prisk said a use class would be “too much of a deterrent at this stage”.

“At this stage we want to get the market going – but our mind is open, although my inclination is to leave it alone,” he added.

In a later session, Andrew Stanford, who heads up the government’s private rented sector taskforce, said: “I  think a PRS use class would sit very well with an investor who is only interested in income.

“If you look forward 10 years down the line there may be a reason to have a PRS use class but the demand in the market at the moment does not want it at this stage.”

Some have argued that a use class would help investors to guarentee income on a certain area of land.

Craig McWilliam, executive director of developments at Grosvenor, said: “If local authorities were committing up front to what they wanted in terms of homes to rent long term, then build to rent investors would be able to see the value and viability in land.”

But Bruce Ritchie, chief executive of Residential Land, said a use class could put off investors who plan to sell property in the future: “The planning consents are not clear enough from a local authority level: if they were to say that instead of an affordable housing provision if you consent to rent this property for a certain period of time – then institutional investors would not want to invest in that.”

Article courtesy of Property Week

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