A consortium of the country’s major landlords, property investors, mortgage lenders and surveyors has requested that the new Government should alter the tax system to allow and encourage large scale house building from institutions, such as pension funds and insurance companies.

The consortium is looking for Government support so that the UK will have a large scale rented sector mirroring that of America or Europe. It is hoping for a more efficient tax system for investors, which could reap major rewards at very little cost to the Exchequer. The major development projects would create thousands of new homes and jobs, securing long term investment in many deprived areas of the country.

Liz Peace, chief executive of the British Property Federation (BPF), said: “The public are bored of countless political promises to fix our housing crisis and while there is no silver bullet, it’s clear that we need to look at new avenues of finance.”

In their response to a Treasury consultation, the Property Industry Alliance (PIA) – a collective which includes the BPF, Investment Property Forum, Royal Institute of Chartered Surveyors, British Council of Shopping Centres, British Council of Offices, the Council of Mortgage Lenders and the Association of Real Estate Funds - want to see some of the significant barriers to investment overcome.

Andrew Stanford, head of residential at Cluttons, chair of the BPF PRS Working Party, said: "It is clear that institutional investment in the PRS could be a key contributor to solving the UK housing crisis. We are sufficiently close to a tipping point which would see institutions invest more in the sector with just a little bit of support from government. The PIA response provides a clear vision of what that support should be and it deserves to be taken seriously by anyone in Government who wants to see more homes being built."