Research by the British Property Federation and Savills, predicting huge expected growth of Build to Rent homes in the UK over the course of the next decade – from 76,800 to over 380,000 – is a product of a changing Britain says Paul Staley, Director at Wise Living.
By Paul Staley, Director at Build to Rent specialist, Wise Living
With the ongoing housing crisis, interest rate hikes on mortgages, and an increased pressure on raising housing standards that are squeezing private landlords, professionally managed Build to Rent homes are becoming more essential in the UK – as the buy-to-let industry struggles to keep up with demand as home ownership becomes more unattainable.
People need a place to call home and it looks increasingly like Build to Rent homes are poised to fill the gap within the housing market and will take a leading role. So, while the origins of the sector were student accommodation and city centre apartment schemes, this will expand into the rise of Build to Rent single family homes (SFH).
Therefore, the predictions that SFH are expected to grow to 18% of all Build to Rent stock from its 12% is not a surprise. More people, right across the UK – not just in cities – want to rent a family home.
This change in the UK housing landscape is also influencing the behaviours of property stakeholders who are responding to these trends. For investors and housing developers, this has meant a shift in the types of portfolios they are creating. It makes sense to diversify and spread both the risk and opportunity. They are doing this by looking outside of the more established Build to Rent markets and into SFH in suburban towns.
In fact, as the UK follows European trends and continues to change from a buying generation into a renting culture, it is highly likely that SFH will outpace other types of Build to Rent housing, eventually. At Wise Living we have seen this demand in-action, with over 15 schemes delivered in the past few years and a healthy pipeline of single-family Build to Rent developments.
As the industry grows this will inevitably increase the number of Build to Rent specialists who will enter the market too, however this needs to be approached with caution. The industry has grown considerably over the last decade, but its success is dependent on the knowledge of the Build to Rent specialists who need to guide investors, developers and local authorities in making the best decisions. Everything from location, housing layouts and types must be looked at and specifications developed to maximise return on investment, while also providing housing that is both high quality and value for money.
The earlier the conversation when it comes to coordinating value for Build to Rent opportunities makes the process more efficient, less risky, and speeds up return on investment.