Build-to-Rent (BTR) is a term used to describe a specific type of residential property development. These developments are purpose-built for renting, rather than selling to individual homeowners. BTR properties are typically owned by institutional investors or property management companies. Tenants are provided with a range of services and amenities that might not be available in a traditional rental property.
The build-to-rent model offers several advantages for both landlords and tenants. Landlords enjoy long-term, stable income streams and reduced void periods. Tenants can enjoy professionally managed homes with access to:
- communal spaces
- amenities
- a sense of community.
Where Did Build-to-Rent Come From?
The concept of build-to-rent is not new. In countries like the United States and Germany, this form of rental housing has been around for decades. The BTR model has gained significant traction in the UK in recent years. This is particularly prominent in London, where housing demand continues to outstrip supply.
The rise of build-to-rent in the UK traces back to the global financial crisis of 2008, which led to a shift in the property market. With homeownership becoming less attainable for many, renting became the norm for a growing number of people. The UK government recognized the need for new housing solutions and began to encourage the development of the BTR sector. They then provided financial support and favourable planning policies to stimulate growth.
How Big Will the Build-to-Rent Sector Be in the UK?
The build-to-rent sector has experienced rapid growth in the UK, particularly in London. According to a 2021 report by the British Property Federation, there were over 157,000 build-to-rent homes completed, under construction, or in planning across the UK, with around 40% of these located in London. The demand for BTR properties will continue growing as more people, particularly young professionals and families, seek out high-quality rental properties with access to amenities and a sense of community.
Industry experts predict that the BTR sector will continue to expand over the next decade. Estimates suggesting that it could be worth as much as £550 billion by 2030. This growth will be driven not only by the continued demand for rental properties but also by the increasing attractiveness of BTR developments as an investment option for institutional investors seeking long-term, stable returns.
We've recently written a detailed article on the subject of build to rent in London.
How Important Are Amenity Spaces?
A key selling point of build-to-rent properties is the provision of amenity spaces and services. These can include communal areas such as lounges, workspaces, and gyms, as well as on-site concierge and management services. Amenity spaces are a critical aspect of the BTR offering. They help to create a sense of community and differentiate these properties from traditional rental options.
The quality and variety of amenity spaces can have a significant impact on the success of a BTR development. Tenants are looking for rental properties that offer not just a place to live but also a lifestyle, with access to facilities and services that enhance their day-to-day lives. As a result, developers are seeking to innovate and improve the range of amenities on offer. Ensuring that their properties remain attractive to potential tenants and competitive within the market.
Why Community is Important
One of the primary reasons behind the popularity of build-to-rent properties, is the emphasis on creating a sense of community. In a transient and fast-paced world, many people are seeking out homes that offer a greater sense of connection and belonging. BTR developments are well positioned to meet this need. Providing communal spaces, events, and services fosters interaction and engagement among residents.
The importance of community in the build-to-rent sector cannot be overstated. Not only does it contribute to the well-being and satisfaction of tenants, but it also helps to build a strong brand and reputation for the BTR development. This helps with attracting future tenants and ensuring long-term success.
Essential Living, Leader in Build to Rent London
In conclusion, the build-to-rent sector is poised for significant growth in the UK. It offers a modern and attractive alternative to traditional rental properties. With a focus on high-quality homes, amenity spaces, and a sense of community, BTR developments are reshaping the rental market and providing much-needed housing solutions for a growing population of renters. As the sector continues to evolve and expand, it will play an important role in meeting the housing needs of the UK.
With buildings in Greenwich, Bethnal Green, Islington and Maidenhead, we’re hoping to transform the way people view renting by making it as hassle-free as possible, with top-notch service, round-the-clock maintenance, transparent pricing and community events.
If you’re looking to rent in London, and would like a little more for your money, get in touch.
