16:24 PM, 22nd February 2012, About 10 years ago 3
A cash-rich housing association is looking to buy to let to generate funds for social housing.
Thames Valley Housing Association has bought 63 flats to rent to young professionals in Epsom, Surrey, and plans to sink another £200 million in to further private rented property.
The plan is buy to let rentals will provide a return for reinvestment in social housing.
The housing association has set up a subsidiary to manage the investments in London and the South East – Fizzy Living Ltd.
Harry Downes, FizzyLiving’s managing director, said: “Only a few young professionals can obtain mortgages so the only option is to rent. Housing tenure has fundamentally shifted right across the UK and the private rental sector is expected to grow as owner occupation becomes little more than a pipedream for the majority of young people.
“There is an acute shortage of professionally managed high-quality accommodation available for private rent to young professionals, and this is the gap we aim to fill.”
TVHA has appointed branding agency Heavenly to create the Fizzy brand, ensuring an appeal to 25-34 year old self-styled “rentysomethings”.
Other housing associations are also considering a move in to buy to let, while Newham Council is negotiating with the government about a law change that will allow the authority to start a buy to let business in the East London borough.
Meanwhile, Sir Adrian Montague has issued a call for evidence for his review of how to encourage greater investment in privately rented properties.
The review is part of the government’s housing strategy, and will examine how to boost rental property investment. The aim is to grow private renting by increasing the supply of affordable homes.
“I want to focus on two fundamental questions. Will the changes that the government has introduced go far enough to generate significant new flows of investment? And, if not, what can be done to accelerate things?” said Montague.
Submissions are sought by March 31 with a report on the findings due around June.