Legal & General Investment Management (LGIM), Britain’s largest investment manager, is advocating for a significant shift in the country’s rental market. Bill Hughes, global head of real assets at LGIM, argues that a reduction in the number of buy-to-let landlords would benefit the British economy.
LGIM’s criticism centers on the presence of “unscrupulous” landlords who provide substandard housing and a negative experience for tenants. Hughes suggests that an overhaul of the rental sector is necessary, with a focus on institutional investment in “build-to-rent” properties.
LGIM itself has invested heavily in this area, building a sizeable portfolio of purpose-built rental homes. They believe that institutional ownership will lead to higher standards and greater stability for renters. Proponents of this approach argue that institutional investors are more likely to prioritize long-term investment and professional property management.
This perspective has ignited a debate. While some support the idea of a more professionalized rental market, others express concerns. Some fear that a decline in buy-to-let opportunities could limit overall rental availability. There are also questions about the potential impact on competition and affordability.
The discussion highlights the complexities of Britain’s housing market. While some buy-to-let landlords undoubtedly provide a valuable service, concerns persist regarding inconsistent standards and tenant protections. LGIM’s proposal offers a potential solution, but it remains to be seen if it will be embraced by policymakers and the wider market.
