The planning system needs to make “build-to-let” developments more attractive to institutional investors, according to a report out today.

The report, commissioned jointly by the Greater London Authority and the British Property Federation, says that institutional investors are needed to increase the rate of housebuilding, but are currently put off by the relatively poor returns on investment.

It says returns would be improved if housing built to be rented out could be treated differently by planners than standard housing developments, in the way that student housing is. Student housing commonly does not have to contribute the same level of affordable housing as standard developments.

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