A new investment vehicle that will provide up to 1,000 affordable homes for rent across Scotland was launched this week, paving the way for new construction jobs.

It is funded by a £55 million loan from the Scottish Government, with matching private investment expected to lift the overall funding package to more than £100 million.

House builders and developers, in partnership with LAR and local authorities, are being invited to get involved in delivering a pipeline of affordable housing.

Eligible tenants are allocated homes based on affordability and income criteria, ensuring tenancies are provided to those in most need.

LAR builds on the Scottish Government’s successful National Housing Trust initiative and means, since 2012, approaching 4,000 new affordable homes have been approved through a range of innovative financing mechanisms, unlocking up to half a billion pounds of housing investment.

There is potential for the LAR model to be extended and replicated widely in the future to provide more affordable homes to meet the significant demand for mid-rent housing.

In Musselburgh, where East Lothian Council and Taylor Wimpey are set to deliver the first LAR housing development, Social Justice Secretary Alex Neil said: “We continue to lead the way in the UK in developing innovative financial models, such as guarantees, loans, grant recycling and new sources of private funding to accelerate the supply of affordable homes. These pioneering approaches help us to make taxpayers’ money stretch further.

“LAR will deliver up to 1,000 homes for mid-market rent offering tenants high quality, affordable mid-rent homes across Scotland, supporting local communities to thrive, tackling inequality and addressing housing need.

“These homes will be in addition to the 30,000 affordable homes, of which at least two thirds will be for social rent, that will be delivered by the end of this Parliament. And there is potential for this model to be extended more widely to meet the significant demand for mid-rent housing.”