Centrick report shows energy efficiency key for BTR renters

The report takes an in-depth look at Britain’s growing Build to Rent market, the factors driving its growth, and why some renters and investors are choosing Build to Rent over the traditional private rented sector (PRS).

Energy efficiency during the cost-of-living crisis has proved to be one of the most important factors Build to Rent renters look for within their residence, according to new research published by Centrick | BTR News
Energy efficiency during the cost-of-living crisis has proved to be one of the most important factors Build to Rent renters look for within their residence, according to new research published by Centrick.

Developer and property specialists Centrick has released its ‘Love Where You Live: The Future of Build to Rent (BTR) Housing: 2024-2028’ report, which highlights the importance of energy efficiency and environmentalism at Build to Rent developments.

Energy efficiency has emerged as the most important factor when choosing a new home, as renters continue to struggle with the cost-of-living crisis, according to the report on the future of Build to Rent and PRS in the UK.

Centrick found that over 83% of renters in both Build to Rent and PRS developments reported that energy efficiency was important to them in their rental property, with the availability of garden and lounge/socialising space completing the renters top three wish-list. Parking and pet friendliness ranked fourth and fifth respectively.

Unlike traditional apartment buildings, Build to Rent properties focus on creating engaged, fully rounded communities with amenities and features such as screening rooms, private dining facilities, hosting kitchens, residents’ lounges and bookable services built in. According to the report, the combination of energy performance and community features is working, with just one in ten current Build to Rent residents considering going back to the private rented sector. 

Regional renters’ preferences 

The report focuses on six cities – London, Birmingham, Manchester, Liverpool, Sheffield and Southampton – where Build to Rent is increasing rapidly in popularity with a wide demographic of residents opting to rent instead of buy. The research suggests that renters have significant and varied preferences, with generational and locational trends emerging strongly. Renters show a significant propensity for choice and movement, with over 50% planning to move from their current property within the next 12 months. 

Key findings include: 

  • Manchester – Most likely to value pet friendliness.
  • Sheffield – 40% of renters willing to pay more for parking.
  • Birmingham – 87% of renters satisfied or very satisfied with current amenities. 
  • London – 88% of renters get on well or very well with the neighbours.
  • Liverpool – 36% of renters willing to pay more for EV charging facilities. 
  • Southampton – 29% residents planning to stay put for 18+ months. 

Understanding the variety of factors influencing Build to Rent demand is essential for stakeholders. The research brings together opinions and preferences from 600 Build to Rent and PRS residents to unveil the preferences, trends and demographic viewpoints impacting the market.

“In recent years, the residential real estate landscape has witnessed the transformative trend known as Build to Rent housing. This innovative approach to housing investment, construction, and management has swiftly emerged as a dynamic and relevant force in the housing market. Our objective is to dig into real world trends from real renters and explore the path forward for both those who seek to invest in Build to Rent developments and those who aspire to call them home. This study is driven by the recognition that Build to Rent is more than a mere housing solution; it is a concept that, when well-executed, can redefine the way we relate to the places we live. It carries the potential to create not just spaces, but communities where people feel a genuine connection to their surroundings, fostering a sense of belonging and happiness in their daily lives.”

James Ackrill, Founder, Centrick

Renter’s budget

Centrick’s study also asked which amenities and features residents would be willing to pay a higher rent for. Parking ranked most highly, with 38.69% of responders citing this as the singular feature they would be willing to pay more for. Garden space and energy efficiency also featured highly at 37% and 36% respectively, echoing what respondents cited as their most important features. Gym and fitness facilities and EV charging are cited at positions four and five respectively.

80% of residents surveyed responded that energy efficiency was important or very important, highlighting that this is the key feature for the majority of renters across both Build to Rent and PRS when considering their next move. 5.59% of responders said that energy efficiency was ‘not important at all’.

Alongside this, the study looks in detail at levels of rental satisfaction using Net Promoter Score (NPS) to measure how renters feel about their current property. Across the regions, Londoners came out as most likely to recommend their property to a friend.

As the economic climate continues to show signs of instability and fluctuation, Centrick highlight that investors and developers of both PRS and Build to Rent developments should take note of the levels of Net Promoter Scores (NPS) and satisfaction, as the report shows clear correlations between satisfaction levels and overall community engagement.

“It’s clear that renters in 2024, more than ever, will be exercising their ability to choose with over 52% of the audience planning to move within the next 12 months, leaving developers and funds faced with the same resident retention challenges in an increasingly competitive market. As Build to Rent evolves in the UK it’s clearly more important than ever to look beyond the facade of pure amenities to create genuine value across the key denominators, prioritising regional and local preferences alongside shifting generational trends. Love Where You Live is more than a research paper; it’s a testament to the transformative power of home, and a celebration of the boundless potential of Build to Rent housing in redefining the way we live, love, and create our lives in the future.”

James Ackrill, Founder, Centrick

Renters feel the value of new and now

In understanding the motivations and perceptions of rental residents, value plays a key factor. Two thirds of renters in the study suggested that they feel their current rental property represented ‘good value’ for money. This average across both Build to Rent and PRS does not reflect growing disparity between the variety and varying quality of aged PRS stock and typically newer build Build to Rent developments. The report expresses that residents clearly perceive this difference, with 75% of Build to Rent residents and only 53% of PRS tenants believe their property is good value for money.