Curbs imposed on buy-to-let

A developer has promised to restrict the sales of homes in a run-down area of Liverpool to stem buy-to-let investment.

The Affordable Housing Development Company (AHDC), which is refurbishing 250 terraced homes in Rockfield, has pledged that it will limit sales to people who promise to live there for three years.

The move is a response to concerns by local residents and agencies that too many inner-city homes are being snapped up by investors, attracted by the low prices that followed the collapse of the local housing market.

Many of these homes are being let out, creating a transitory population that they say further undermines the area’s fragile social stability.

The AHDC agreed to the restriction after an agreement with residents and officials. Dr Derek Smith, chairman of the AHDC, said it aimed to rebuild the community by encouraging former residents to return. “We want to rebuild communities. That is why we will give first choice to local people. We aim to sell only to owner-occupiers.”

A spokeswoman for the New Heartlands pathfinder, which is overseeing Merseyside’s housing market renewal programme, said: “We’re trying to attract people into the area and to build sustainable communities.”

The AHDC is refurbishing the homes, which were formerly owned by Arena housing association. They are within a short walk of Anfield stadium, where Liverpool football club play their home games.

Brendan Nevin, a regeneration expert and a visiting professor at Salford University, said: “The buy-to-let market causes instability, so this seems to be an innovative solution to try to stabilise this area.”

The government’s £500m housing market renewal programme has sparked interest from developers in areas that have been investment-free zones for decades, according to the nine pathfinder bodies. The pathfinders have been designed to revive housing markets in depressed parts of the north of England and the Midlands.

The Rockfield launch took place in the same week that figures were published by Assetz Property Investment Tracker showing that the UK offers buy-to-let investors the second best returns of any European country based on predictions of continued strong house price growth.