The UK is currently facing an enduring housing crisis with significant shortages of affordable accommodation – but could this gap provide an opportunity for social impact focused investors? 

The latest research by Property Funds Research, Homes England and Investment Property Forum suggests that it might in a report, which has reviewed the merits of including social and affordable housing assets within institutional investment portfolios. 

Key findings within the report highlighted that social and affordable rents are subject to government-led rent-setting regimes (usually on par with inflation) and not market forces, therefore they are less vulnerable to change compared to commercial property within the business cycle. 

Investments in social housing also demonstrated low and stable vacancy rates with relatively high rent in comparison to retail, offices and industrial property assets. Along with strong credit fundamentals and low correlation with other real estate sectors, this indicates that social and affordable housing assets provide resilient, stable and diversified cashflows and are set to become an increasing proportion of institutional investment portfolios. 

Investments that make an impact are understandably top of investors’ minds and the report also highlights that social and affordable housing caters to the increasing need to consider ESG agendas when investing. 

Download the full report here. 

At HSPG, we are dedicated to increasing the supply of social housing across the UK, ensuring those who need it most have a house to call home.  

To find out more about our efforts to support the housing crisis, visit our strategies or contact us.