Ministry of Housing, Communities and Local Government announces significant updates to the Private Rented Sector Housing Guarantee Scheme Rules
On March 7, 2025, the Ministry of Housing, Communities and Local Government (MHCLG) announced significant updates to the Private Rented Sector (PRS) Housing Guarantee Scheme Rules. These revisions aim to bolster the Build to Rent sector by reopening the scheme to new applicants and aligning its rules with current market practices.
Key Updates to the PRS Housing Guarantee Scheme:
Reopening of Applications: The scheme is now open to new applicants, offering fresh opportunities for investment in the private rented sector.
Extended Application Deadline: Interested parties must submit their applications by February 28, 2028. This extension provides a broader window for developers and investors to participate in the scheme.
Loan Tenure: The scheme offers debt guarantees for loans with durations of up to 30 years, providing long-term financial stability for housing projects.
No Maximum Debt Limit: There is no cap on the size of debt that can be guaranteed, allowing for flexibility in financing large-scale developments.
Geographical Coverage: The scheme is available for projects across England, Wales, Scotland, and Northern Ireland, encouraging widespread development in the private rented sector.
Eligibility Criteria: Borrowers must not be classified under the UK public sector, ensuring that private entities primarily benefit from the scheme. However, Private Registered Providers (registered non-Local Authority Housing Associations in England) remain eligible, irrespective of any future classification changes.
Funding Availability: Loan applications are considered for projects that have either completed construction and are suitable for occupation or are partially or fully leased-up. This approach ensures that funds are directed toward viable and ready-to-occupy developments.
Development Period Exclusion: The scheme does not cover the development period, focusing instead on post-construction financing needs.
These updates reflect the government's commitment to supporting the Build to Rent sector, aiming to increase the availability of quality rental housing and stimulate economic growth through enhanced investment opportunities.