Firms line up to take part in HCA's private rental scheme

One of the country’s biggest housing associations and a property consultancy are among those bidding to join a government scheme to pump hundreds of millions of pounds into privately rented housing.

Housing association Places for People will submit an expression of interest to the Homes and Communities Agency (HCA), which is running the scheme to encourage investors to fund privately rented homes.

David Cowans, the housing association’s chief executive, said he was interested in providing development and management services for the scheme and “a degree of investment if the deal was right”.

Cowans said conditions in the property market made it a good time to start a fund. “Property values have fallen, rents have broadly stabilised and it is possible to get a more acceptable yield.” Blueroom, the association’s private rental subsidiary, has been running since 1999.

Property values have fallen, rents have stabilised and yields are more acceptable

David Cowans, Places For People

Property consultancy Bespoke Property Group also plans to set up a £200m fund with bank Liberum Capital, KPMG, and solicitor Devonshires.

Andy Leahy, managing director of Bespoke, said the firm was considering including social rented and shared ownership properties in the scheme in addition to market and intermediate rented homes but would need to discuss this further with the HCA.

Another large housing association is also rumoured to be looking at setting up a fund. Private landlord Grainger, and Legal and General Property are interested in the scheme but waiting for the details before deciding whether to bid.

A spokesman for the HCA said it might guarantee to pay the fund part of lost rental income if the number of empty homes rose above a certain level, or underwrite the scheme in its early years.