The chairman of the Commons housing, communities and local government committee has criticised the institutional bulk-buying of existing homes for denying first time purchasers a chance to get on the ladder.
Lloyds Bank is one of a number of major businesses from outside the traditional property sector to have revealed plans to bulk-buy existing homes and let them out.
Now Labour MP and committee chair Clive Betts has told The Times: “If it is the case that these sorts of investments are forcing out, or jumping in front of, first-time buyers then that is where problems start to occur.
“The housing crisis continues to loom large and we should be doing everything to allow first-time buyers on the property ladder, not allowing them to be pushed to the back of the queue.”
Lloyds Bank - which in recent months has set out broad proposals to become a residential landlord - says it’s set itself a ‘strategic challenge’ of buying 10,000 properties by the end of 2025, then 50,000 by 2030.
The bank is not so far building its own homes in the way of a Build To Rent operator but is for now buying new-builds; The Times reports that it’s snapped up 45 of 358 new flats at the Fletton Quays block in Peterborough.
Betts adds that many Build To Rent investments provided new development and says that as long as these are additional to properties for first-time buyers, they play an important role in the housing market.
Lloyds says that a subsidiary set up to handle its acquisition and letting of properties - a company called Citra - would have a balance sheet worth £4 billion and generate £300m million pre-taxprofit with 10,000 homes.
It says Citra may consider mergers and acquisitions or strategic alliances to reach the 50,000 target.
The Times piece - which conflates the Lloyds bulk purchase with Build To Rent and Real Estate Investment Trusts - can be seen here.