By Lee Richards, Director of Market Services, Mainstay
The pandemic has redefined the meaning of the home and with it, instigated a drastic shift in priorities. With the freedom of movement restricted and the wealth of amenities and culture no longer on the doorstep (albeit temporarily), big cities have looked less appealing. People have been forced to look outside of their usual norm, and towards aspirations of new environments, access to green spaces and community living. This, combined with a decline in private landlords over the last few years despite demand for rental properties, means Build to Rent is gaining momentum across the UK, particularly with increased demand outside of big cities.
Build to Rent, or ‘multi-family’ living, already has a strong presence in the US and is experiencing a boost into the UK mainstream, previously concentrated in big cities. Lockdown has been a marker of great change for the market, prompted by an increase in residents seeking the flexibility and lifestyle Build to Rent can offer. The rental sector has doubled in size in the past 20 years, with an estimated 19% of households (11 million people) now renting privately, according to the English Housing Survey and Build to Rent offers the adaptability for those looking to evolve their current lifestyles.
A change of scenery
The localised restrictions and ‘stay at home’ messaging over the last year re-defined what home-seekers looked for in a rental property. Green space is at the top of lists of necessities, and according to Rightmove, searches by renters looking for a garden were the highest they’ve ever been in 2020. With the only freedom during the lockdown measures being exercise, renters and homeowners began to value the importance of living near greenery, away from big cities.
Despite restrictions lifting across the UK, this trend is here to stay with 27% of London renters still planning on leaving the city after the pandemic has settled, according to SpareRoom. Young professionals looking to rent are now choosing to look outside of Central London and at Mainstay, we’ve seen an increase in the number of clients seeking to develop schemes outside of the usual larger cities like Manchester and Birmingham, with easy access to an abundance of green space. Currently 84% of all UK Build to Rent planned developments are outside of Central London and over the last year this demand has continued to grow.
In adapting to social distancing and tight restrictions, people have found the pandemic has also created a united thirst for a sense of community. Loneliness and feelings of being isolated has swept the nation and neighbours have relied on one another over the past year to get by, from supporting with grocery shopping to picking up prescriptions for one another. It is significant that seven in ten people in the UK now feel like they are part of their local community, according to The Community Fund.
This has been reflected in the interest we’ve seen from prospective tenants across all age ranges as Build to Rent offers the opportunity for community enhancing services, which appeals to those looking for a community feel within a big city, but also for those wanting to move further afield whilst maintaining access to sociable perks. Many Build to Rent developments offer on-site personal services as well as bars, cinemas and communal outside space across developments.
New form of retirement living
Not only is the rental sector changing, but the profile of renters is adapting and is no longer driven by city-living, young professionals looking for a cheaper way of living. A new market of over-55s is migrating towards renting, with the number of retired renters surging by 118% in the last year. Many are looking for purpose-built communities with more flexibility and are interested in living in a specialist community. Quality of housing is directly linked with physical, mental and emotional wellbeing and enabling people to choose how they live with the flexible offering of independence and care if needed, will be a major draw.
At Mainstay, we continue to see an increase in enquires for Build to Rent retirement schemes with locations much more geared outside of the city, including smaller towns and most commonly on the south coast. The demand is seeing former care homes, such as Hilltop Lodge in Epping, planning to repurpose their space into a dedicated Build to Rent retirement development where residents have their own flats with the benefit of communal lounges.
Build to Rent has come a long way in the last year and is set to evolve even further as the world gradually adjusts to the new ‘normal’ way of living and people evolve the way they live to adapt to new needs, and I expect new demands, trends and challenges will continue to emerge.
As renters seek spaces outside of the city that capture the community feel that helped them through the pandemic, the appeal and drive for high-quality, professionally managed rental homes will ultimately continue to grow. The post Covid-19 world provides a huge opportunity for Build to Rent to continue to move with the time and deliver on its commitment to change the rental market, keeping consumer needs and desires at its core.