Warning: mysqli_num_fields() expects parameter 1 to be mysqli_result, boolean given in /home/abodeltd/public_html/wordpress/wp-includes/wp-db.php on line 3283
Build to Rent - is this the new buzz strategy?

Build to Rent – is this the new strategy that will change the property rental market?

Build to Rent - is this the new property strategy?

Build to Rent – is this the new property strategy?

 

More than £30 billion could be invested in the Build to Rent Sector over the next five years, according to a report out today by the law firm Addleshaw Goddard and The British Property Federation. They say it could lead to more homes being built, more than 150,000, if there are the right incentives from Government.

Michella Hancock, Development Director for Build to Rent at Grainger, a company that owns, rents and manages properties, was asked by BBC Five Live’s Wake up to Money, how is this sector different to what already exists in the UK at the moment?

The Build to Rent sector is the fastest growing sector of the UK housing market and it sits between social housing and home ownership, more than 9 million people now rent privately in the UK and that is 1 out 3 people in London and 1 out of 5 in the UK wide, so this is massive opportunity.

What we are trying to do is different. We are trying to do a branded rental which has the perception to shift perception of renting by offering a professional managed, quality product that is specifically designed with the rental customer in mind.

There are two key reasons why this idea has not come about until now, firstly until now investors have been able to earn better returns from other asset classes but with bonds and fixed income returns at a all time low residential property now looks attractive where the rent is your income and there is now huge appetite from developers, institutions and major banks to gain exposure to the build to rent model.

Michella says that the second reason is with renting having more than doubled since 2000, the increase in demand is extremely clear. that is for a couple of factors, both financial and social. Not only the availability of mortgages but social change, such a peoples lifestyles. People are settling down at a later age, they may want to travel more, and might not want to be locked into a mortgage or have that maintenance because this can be an aspirational choice.

It is all about providing quality and choice, so all different types of tenures and housing. So for example if you chose to rent a property that had communal gardens then you would perhaps pay more than without. We will have a standard product quality within our properties and then there will be a certain number of add ons that tenants can choose to have for a higher price. We will match services, amenities and quality.

So is Build to Rent the new buzz word in property investing. We will now see a number of building projects taking place where the build is specifcally for the rental market? What will this do to the rental market as a whole?

It is certainly something that we as landlords needs to be aware of. Tenants may be enticed by the shiny new properties and move away from the more common property stock that landlords rent out, such as traditional Victorian terraces we see in Manchester. 

Tags: , , , ,

No comments yet.

Leave a Reply

Become the forefront of local landlord knowledge

Subscribe to our monthly newsletter for the latest landlord and industry news, buy to let tips and upcoming property developments. Your details will never be shared and you can unsubscribe at any opportunity.
Email address
Secure details and no third party spam, guaranteed.