Montague Review recommends planning changes to attract investment

Sir Adrian Montague's long-awaited 'Montague Review' could recommend that local authorities waive affordable housing on selected developments to make the sector more attractive to institutional investment, according to a report by industry magazine Property Week.

The review, expected to be published this week, examined how best to encourage institutional investment into the private rented sector. It is expected that Montague will make five 'key' recommendations to Government to lift the barriers currently preventing large financial institutions from investing in the sector.

The planning system could be used to make the sector more attractive to investors by making the building of new privately rented homes more attractive, the report is expected to recommend. This could be done by waiving affordable housing requirements in appropriate circumstances, or placing covenants on land to ensure it remains in the rented sector for a fixed period of time.

The report is also expected to build on the Government's recent moves to release public sector land, by recommending that more public sector land is made available specifically for private rented schemes. The release of public sector land for private rented schemes would be overseen by a named minister and official in each Government department, who will ensure land of the right scale for private rented schemes is made available to investors, according to the Property Week report.

Montague could also recommend that Government funding be used to 'kick-start' institutional investment into the sector, according to Property Week. The funding could take a number of forms, including the sharing of investment risk with institutions, a Government fund aimed at attracting investment, or by injecting equity or debt into selected schemes.

A 'Housing Task Force' could also be set up, which would follow the lines of the Government's announcement of providing advice to councils and developers to restart stalled schemes. The task force would provide expertise to both the Government and investors and would be made up of members from the private sector, the publication said.

A new system which sets out the quality standards that developments receiving Government funding must meet is also expected to be recommended. The standards would be used to show tenants the standards to be expected from landlords.

As part of the evidence gathering for the Review, Montague issued a call for evidence in January, which attracted submissions from over 60 institutions, housebuilders, social housing providers, local authorities and regeneration bodies.