Hearthstone Investments, a specialist residential fund manager, has received UK regulatory approval for its residential property fund.

The TM Hearthstone UK Residential Property Fund, due to soft launch this summer with a rollout planned for September, will for the first time give investors access to the £4 trillion (about $6 trillion) residential property market through an authorised fund.

Structured as a Property Authorised Investment Fund, it will be open to investors from individuals to large scale institutional pension schemes. The minimum investment for retail share classes is £1,000; the fund permits regular savings.

The fund will be managed by David Gibbins and Lucy Hawkins, who will aim to track the House Price Index by investing in private rented sector housing across the UK.

The business is currently working with major house builders to seed the fund with an initial portfolio of around £30-£50 million. As well as acquiring existing build stock, the team will work with developers to support future acquisitions from new residential developments.

Hearthstone’s target for the fund is £250 million in the first 24 months of it going live, rising to potentially more than £1 billion in the longer term as the adoption of residential funds becomes more widespread.

Earlier this year, estate agency and property services provider the Connells Group, a wholly-owned subsidiary of Skipton Building Society, acquired a 25 per cent strategic stake in Hearthstone.