The Minister of State, Department for Communities and Local Government (Brandon Lewis)
The Government can announce that they have awarded the licence for the private rented sector housing guarantee scheme to PRS Operations Ltd, a subsidiary of Venn Partners LLP. Venn Partners’ bid was selected through an open and competitive procurement process, following a period of thorough market engagement.
The Government are committed to expanding the rented sector, including supporting the creation of a bigger and better private rented sector, in order to expand the provision of rented housing, boost economic growth, increase choice and improve quality for tenants. The private rented sector plays an increasingly important role in the housing market. It is now the second largest tenure in England, with demand predicted to grow.
The Government’s £10 billion housing guarantees schemes—comprising the affordable housing guarantee scheme and the private rented sector housing guarantee scheme—are working to reduce the cost of investing in new, additional affordable and private rented sector housing. Furthermore, the private rented sector housing guarantee scheme will help create a new market for institutional investment in the private rented sector.
The affordable housing guarantee scheme, as operated by Affordable Housing Finance plc, has already demonstrated considerable success—facilitating the investment of over £1 billion in new affordable housing, through the cheapest debt in the sector’s history.
On 11 June 2014 a minute was laid before the House setting out details of the contingent liability created by the private rented sector housing guarantee scheme. Under the private rented sector housing guarantee scheme, the Department for Communities and Local Government will guarantee up to £3.5 billion of debt on terms of up to 30 years for developers who commit to building new private rented sector housing, held long-term for private rent.
Venn Partners are now able to receive applications and we expect the first applications to be approved in 2015, subject to due diligence procedures. I am looking forward to working with them to deliver the scheme.