A new initiative has been launched to boost investment in Scotland's private rented housing sector.

The Rental Income Guarantee Scheme (RIGS) is the first of its kind in the UK and has the potential to generate £500 million of investment, as well as support the delivery of around 2,500 new private rented homes.

Under the scheme, RIGS guarantees 50% of any gap between actual and projected rental income of a development which will provide greater certainty of rental income to investors and landlords during the initial years of letting.

Announcing the initiative's launch, Housing Minister Kevin Stewart said: "This scheme will help deliver new, high quality private rented homes for tenants, which are modern, energy efficient and professionally managed. It does so in a way that provides assurances for investors, while ensuring good commercial practice and the incentive for investors to let these homes."

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Nicola Barclay, Chief Executive of trade body Homes for Scotland, which led a Government-commissioned project on how to expand the build to rent sector, added: "The announcement of the Rental Income Guarantee Scheme will provide investors with greater confidence during the early stages of development, when letting risk is likely to be highest and is just one of the levers the Scottish Government has put in place to help boost a tenure which has such an important part to play in meeting the diverse housing needs of our growing population.

"As well as the significant investment and development opportunities on offer, expanding build-to-rent will help increase choice, flexibility and affordability for tenants. Most importantly, perhaps, it also has the ability to transform customer experience of the private rented sector through the delivery of new high-quality, purpose-built and professionally-managed accommodation."

RIGS is open for applications from today, 12 October. For more information, visit www.rigs.rent

(LM)