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Gloucestershire Business News

Lloyds plans major move into UK rental market

Lloyds, the UK's biggest mortgage lender, is now aiming to become one of the country's biggest private landlords.

Reports have emerged that Lloyds Banking Group has set a target of buying 50,000 homes in the next ten years as it seeks to diversify its portfolio.

The bank is not the only major company looking at moving into the housing market to broaden its revenue streams - high street retailer John Lewis is also looking to buy ten thousand homes for rental in the next ten years.

Big-name fund management groups and insurers, including Legal & General and M&G, have also entered the private rental market.

Lloyds announced its entry into the private rental market early last month. It revealed its first development at Fletton Quays in Peterborough, with 45 flats to let.

Its standalone brand Citra Living, according to the Financial Times, placed an internal job advertisement revealing a target of reaching 10,000 properties by the end of 2025, and 50,000 by 2030.

It's estimated that one in five households rent from private landlords in the UK and it's expected that this number will rise as house purchase moves out of the range for many younger people.

Many amateur landlords, attracted by the buy-to-let boom, have now left the market because of complicated regulations and tax changes, despite the record low interest rates. This has led to a shortage of properties to let at a time of record low interest rates.

Lloyds has already said it plans to acquire about 400 properties by the end of this year, and the same again next year. The company recently signed a strategic partnership with housebuilders Barratt.

The internal job advert, placed by Citra Living estimated that 10,000 homes would generate about £4bn, with a pre-tax profit of £300m for the Lloyds Bank balance sheet.

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