The Homes and Communities Agency (HCA) has unveiled plans to encourage pension funds to invest in private rented housing in a move which represents a turnaround on current thinking regarding the UK property market.

The HCA - a non-departmental public body which is backed by the Communities and Local Government department - is launching a new scheme to get institutional investors to come into the private residential rental sector, in what could create a new asset class for investors in the long term.

The scheme could fundamentally alter the UK's housing market by creating what it called a 'professional sector'.

There is also the opportunity to build rental accommodation on a large scale, helping to alleviate the current shortage of housing in the UK.

If it gets off the ground, the scheme – which is rumoured to be supported by a number of institutions including Legal & General and HSBC – could create a new sector within the UK housing market to sit alongside home-ownership and social housing.

The new focus on rental accommodation en masse has come around as a result of the yield opportunities rental property now offers.

UK leading website for property investors with FREE resourses - http://www.rhettlewis.com