‘Champion’ to draw investors into rented housing sector
The rented house-building sector in Scotland has been given its own “champion” to encourage more investment in the sector and plug a growing shortfall in the provision of new homes.
The appointment of former Cala Homes director Gerry More confirms my story in The Scotsman in July that the trade body Homes for Scotland was about to make such an appointment to stimulate interest from investors and planners.
More, a consultant and non-executive director to a number of property related companies, will be urged to encourage more institutional investment and bring the various stakeholders in the sector together.
He chaired the steering group which commissioned research work from the Cambridge Centre for Housing & Planning Research and the London School of Economics. More has been closely involved in the Scottish Government-supported project since its inception in 2013 and which last year made recommendations to seek out further funding to support a shift in gear in the rented sector.
According to official estimates Scotland needs 465,000 new homes by 2035 in order to meet housing demand. Current build rates pointing to a significant shortfall on this figure,
Speaking about his appointment this morning, More said: “There has been talk for some years that large financial institutions were interested in investing in rented residential development but this has not yet materialised to any great effect in Scotland.
“Quite clearly, new thinking and new approaches are required in order to translate this latent interest into activity. And this is where the real work starts, implementing the recommendations of last year’s research report.
“With government backing and local authority support, we believe that institutions will invest long-term into a professionalised private rented sector. And there are clear parallels of what has been achieved in student accommodation where yields rather than vacant possession for owner occupiers drive the value of properties.
“Bringing such investment to Scotland offers many benefits. As well as increasing economic activity and creating jobs, the building of much needed new homes to some of the highest technical standards in Europe will result in lower fuel bills and better living standards when compared to existing inferior stock.
“The legacy of the Champion role will be in tackling the current market failure facing the private rented sector by increasing awareness of investment opportunities and ultimately delivering large-scale, long-term institutional investment.”
Deputy first minister Nicola Sturgeon said: “The Scottish Government recognises the potential that exists to unlock new and alternative sources of housing investment in this sector, and that is why we provided funding towards the post, as well as the research study undertaken by housing finance experts which has made a number of key recommendations to attract new forms of investment.”