On 13 December we hosted a roundtable, in partnership with Grainger, to explore whether and how institutional investment could support the housing needs of people on low-to-middle incomes. The roundtable event was attended by a range of stakeholders including institutions, housing associations, landlords, experts and government policy makers. Key barriers to institutional investment included:
- lower net income returns in comparison to the commercial market;
- the lack of scale to make sizeable investments;
- tax impediments;
- cost of land;
- planning bureaucracy;
- management burden and reputational risk that comes from direct investment;
- lack of familiarity with the residential market;
- the fact that the eventual sale of the property on the owner-occupier market is worth more than the rental unit.
A range of solutions and models were identified that would support further investment. We will be looking into these further over the coming months.