Mayor of London Boris Johnson has received another boost to his supplementary planning guidance, with the British Property Federation (BPF) coming out with strong support for his draft guidance on housing for London, which supports the build-to-rent sector.
What does the guidance suggest?
The Mayor’s guidance, which has been issued for consultation, believes that positive support should be given for long-term private rented ventures. This will be done by recognising how the private rental sector can address distinct needs in local planning.
It also calls for greater support from long-term private rented ventures through development management, with these being particularly suitable for certain locations such as town centres and commuter hotspots.
What does the BPF think?
Overall, it appears as though the BPF are highly interested in the proposals, particularly in relation to how they might affect local authorities. This especially relates to the guidance’s view on whether a covenant can be used to secure developments as rented for a defined period of time, and take account of the different viability of the sector in public land deals.
The BPF’s Director of Real Estate Policy, Ian Fletcher, has praised the scheme, showing near whole hearted support, declaring that: “The Mayor is at the forefront of recognising the contribution that build-to-rent can make to the quantity and quality of rented homes in London.”
The BPF’s support comes from the clarity the guidance offers. Institutional investors often like clarity, and this supplementary planning guidance covers a wide range of issues, including what developers and local authorities can do and expect.
Particularly, the BPF supports the guidance paper in its aim to protect local authorities’ positions if the owner seeks to sell rather than rent. Mr Fletcher also went on to state that "The BPF supports developers and boroughs considering including discounted market rent (intermediate rent) as the affordable offer and welcomes the London Housing Strategy's target of 5,000 homes per annum from build-to-rent."
Overall, the London Mayor is targeting building 5,000 build-to-let units as part of his plan to build 42,000 new homes in the capital each year. It’s hoped that these homes will be able to increase standards in the PRS in London, by increasing the number of long-term tenancies and creating professional block management of properties.
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Information correct as of 04/06/2015