Citra Living, the build-to-rent investment division of Lloyds Banking Group, and Barratt Homes have started a third development in their rented residential joint venture.

Citra and the housebuilder have started development on 66 rental homes at Wixams near Bedford, to the north of London.

Announced last August, the partnership will see Citra and Barratt deliver up to 1,000 additional new homes across the UK annually. This will see Citra invest in existing properties and those that would not have been built otherwise, and allow Barratt Homes to bring forward other developments.

The 25 flats and 41 houses range from two-bed apartments to four-bedroom family homes that will complete in phases between 2023 and 2024.

They are the first to be undertaken from planning to completion by the partnership. It follows the acquisition of 150 new homes by Citra Living at Barratt Homes’ Ladden Garden Village, near Bristol, last year and 58 homes in Cramlington, near Newcastle.

As part of Citra’s commitment to offering quality homes in the places people want them, all the new properties at Wixams will be built to exceed upcoming energy performance requirements for rented homes. From 2025, new tenancies must have a minimum Energy Performance Certificate rating of C. The homes will feature advances in insulation and double glazing to maximise energy-efficiency.

Lloyds said it wants to grow Citra to a portfolio of as many as 50,000 homes, primarily through partnering with other organisations that are building new homes.

Tie-ups between SFR investors and housebuilders could become more common in the next couple of years. The rising cost of mortgages is expected to see the pace of home sales slow as buying a house becomes more expensive. Because of that, it's likely more people will have to rent, pushing up rental levels.