RIBA鈥檚 Future Homes Commission to call for local government pension funds to invest 拢10bn in homes for private rent
A wide-ranging report commissioned by the RIBA into the future of housing in the UK will call for local government pension funds to invest 拢10bn in homes for private rent.
Sir John Banham, chair of RIBA鈥檚 Future Homes Commission, said the report, to be launched in the next few weeks, will say there is potential for the 15 biggest council pension funds to put 15% of their assets into a fund, raising 拢10bn to invest in private rented housing, thereby stimulating the construction of new homes.
Banham, a former director general of the CBI and chair of Tarmac, said the report found there is up to 拢180bn of local government funding effectively held 鈥渋n suspended animation鈥�, a proportion of which could be used to fund housing.
Speaking at last week鈥檚 Housing Market Intelligence conference run by the Home Builders鈥� Federation, he said rental housing would provide pension funds with a return of more than 10% a year.
He said: 鈥淲e will ask for local government pension funds to do what they should be doing already. To have these public assets held in suspended animation in the middle of one of the most severe economic crises in a generation is not right.
鈥淭hey need to invest in developments that give them a return of better than 8%. This is a huge opportunity, the problem is they鈥檙e terrified of doing anything and at the moment there isn鈥檛 the product to invest in.鈥�
Banham said the commission would also recommend housing construction rates be upped three-fold, and a much greater focus by housebuilders on design in order to prevent opposition to new development.
Riba convened the Future Homes Commission, consisting of Banham, former CLG permanent secretary Mavis McDonald, property consultant Kate Faulkner and ICA architecture chair Roger Graef, last year following on from branding UK new homes 鈥渟hameful shoeboxes鈥� that were on average 8% smaller than the recommended minimum size.
Banham said the Commission would also recommend housing construction rates be upped three-fold, and a much greater focus by housebuilders on design in order to prevent opposition to new development.
However, it seems the report is unlikely to be as critical of housing design as anticipated. Speaking at last week鈥檚 Labour Party conference, commissioner Kate Faulkner said: 鈥淣ot all new homes were as bad as we thought they were. They鈥檙e not all boxes.鈥�
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