BUILD TO RENT - What is it and why does it work?
What is Build to Rent?
‘Build to Rent’ defines privately rented residential property that is built for rental rather than for sale. Build to Rent (B2R) entails the construction of dwellings particularly for the rental market, as the name implies. Corporations (such as property companies or pension or insurance investment companies) often own these developments, which are rented directly or through an agency.
Build-to-rent developments have sprouted up across the UK in the last seven years or so. Building on the success of the student housing market and the Build-to-Rent sector in the United States and Europe, UK-based institutions are now catching up and recognising residential property as an investment class. London, Liverpool, Manchester, and Birmingham are the most populous cities in the United Kingdom.
What makes build to rent properties different?
Build to Rent properties are often popular due to the amenities they provide and the quality to which they were constructed; one advantage of building brand new apartment blocks is that they are modern, energy-efficient, and finished to a high standard.
It's no surprise that renters in Build to Rent buildings often compare their living situation to that of a hotel, with many offering additional, optional services that may greatly enhance the rental experience if their budget allows it.
The following are some of the types of advantages of Build to Rent properties:
Social activities and organisations for residents to form a community
On-site support and maintenance workers
Pricing clarity; no unexpected rises; lengthier tenancy possibilities of over three years
The types of Build to Rent complexes and apartments have been created from the bottom up with renters in mind, making them a wonderful option for those looking at something a bit different or a more managed service.
What benefits does build to rent have for the tenants?
Tenants who feel like they belong to a community are more inclined to stay. As a result, the danger of rent voids is reduced, which is advantageous because rent voids have a negative impact on net operating income.
According to reports, people who know one other person in a building are 75% more likely to renew their lease. This figure rises to a surprising 90% for those who know two more people. The value of community has been proven.
It's also worth noting that, like landlords of typical rental properties, Build to Rent landlords must be members of a recognised ombudsman programme and follow a thorough complaints procedure.
This offers reassurance to renters as there are systems in place to protect them if problems with the property arise or if they require assistance.
According to studies, the advantages of Build to Rent can be enormous. Almost half of renters said that paying no further up-front expenses other than a deposit and rent advice would improve their renting experience significantly when speaking to the Home Owners Alliance.
Furthermore, 40% indicated that renting directly from a responsible organisation or housing provider rather than a private landlord or lettings agent would be preferable.
Over a third of respondents indicated that renting a high-quality property that met safety and energy efficiency criteria would greatly improve their rental experience. That's hardly surprising given that, according to research, more than a third of renters are unable to.
