Property fund set to buy houses for homeless tenants

Property fund set to buy houses for homeless tenants

A property fund spun off from a homeless charity is set to buy a portfolio of affordable rental properties suitable for vulnerable tenants, and is to open up to ‘ordinary’ investors.

The Real Lettings Property fund has so far raised £16.25m from housing associations and charities. Investors include City of London Corporation and Big Society Capital, which have invested £500,000 and £5m respectively. Big Society Capital uses money that is lying in dormant bank accounts.

The fund has now bought its first property, a £250,000 two-bed flat that is planned to be the first of 240 purchases across London. The properties will be rented out to people most in need, at slightly under market rents.

The fund is run by Real Lettings, the lettings agency arm of Broadway, a homeless charity, and Resonance, a social impact investment company.

It is now looking for other investors, with a minimum stake of £50,000.

Simon Chishold, managing director of Resonance said: “At heart this is a very simple fund – it’s investing in property but with a clear social purpose.”

The fund, which has a seven-year life, is aiming to deliver 5% a year returns to its investors.

Real Lettings already leases 167 flats from private landlords.