Sir Adrian Montague, author of the government’s recent review of the private rented sector, defended his report to a committee of MPs recently, saying that large-scale investment in rental property would help lower rents, extend tenancies, improve quality and help drive inward investment.

Montague dismissed the need for rent caps or any regulatory change, insisting that institutional investment could improve stability for tenants through long-term lets, and that social housing providers could also play a key role in delivering market rented housing.

Recent government figures have confirmed that the private rented sector had hit a new peak with 3.8 million households now renting from private sector landlords – practically the same number as in the social housing sector.

London-based Essential Living, the first institutionally backed developer focused solely on the PRS, has acquired two sites already and plans to deliver more than 5,000 new rental homes over the next decade.

The firm, launched last September by industry veterans Darryl Flay and Scott Hammond, is backed with over £200 million of American pension fund cash via M3 Capital Partners.

Darryl Flay, CEO at Essential Living, said: “Open debates like this are a fine way of broadening everyone’s understanding of what opportunities the private rented sector offers, not just for the consumer, but for policy-makers looking for ways to increase housing supply and drive local investment. It’s our responsibility to work closely with the public sector to deliver what both sides want – quality developments held over the long term.

“Sir Adrian is echoing the widely held view that build-to-let has a vital role to play – not just in driving up standards through professional management or encourage inward investment, but through bringing genuinely new funding into the housing sector at a time when it is so desperately needed.”