The chairman of Berkeley Group said the house builder was setting up a rented housing fund to build 380 homes next year.

This is Berkeley Group’s second foray into a homes for rent deal and comes after Chancellor George Osborne unveiled plans to offer grants for rental homes pegged at 80% of the market rate.

Pidgley said the move would help finish sites as buyer demand slowed and take advantage of the new Government funding initiative.

Berkeley’s first rental scheme was built under the Housing and Communities Agency’s private rental initiative, which sees the agency retain a 20% stake in the homes.

This latest deal is being set up with a council and will see Berkeley own and manage the homes.

Pidgley predicted that more developers would follow as long as mortgages remained hard to secure and rents remained high because of housing shortages.

He said: “The industry has got to change its approach. The days of a house builder buying it, building it, selling it and walking away are, I think, gone.

“If the sites don’t get developed there will be no homes. So what we’re saying to local authorities is that we’ll lock them in and we’ll rent them at a discount. It’s just a private sector company doing what the RSLs do.”