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If Help to Buy comes under pressure, there is always Build to Rent

28/02/2019 · Persimmon (PSN)  · Sigma Capital Group PLC (SGM)  · Telford Homes plc (TEF) 

Housebuilders UK

House being built

Amid the controversy surrounding super-profitable housebuilders which have been boosted by the government’s help-to-buy scheme, Telford Homes has announced a challenging sales outlook. The London-focused housebuilder is therefore set to increase its focus on build-to-rent – will the larger housebuilders ultimately follow?


London’s property market is in a terrible state. Housing demand is high and rising, but the city is becoming even less affordable and house sales have stalled. With property prices in the capital subdued and seemingly set to remain so, London-focused housebuilder Telford Homes (LON: TEF) has announced a greater focus on the build to rent sector.

Telford considers that building houses for the rental market, where the development is generally sold to an institutional investor or fund prior to completion, reduces its market risk in exchange for a lower margin and less overall profit. Telford expects to significantly increase the output of homes under this new model over the next five years.

According to Telford, the number of Londoners renting is rising and will continue to do so, not just due to affordability, but because young people are looking for greater flexibility. Jon Di-Stefano, chief executive said, “build to rent housing will be one of the keys to solving London's housing crisis”

It’s…

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