Cities driving rental growth in the Build to Rent sector

New research analysing rental market data reveals the cities driving rental growth in the Build to Rent sector.

Baytree Lane - cities driving rental growth - Ascend Properties | BTR News
Baytree Lane.

Newcastle, Leeds, Birmingham and Manchester have seen the largest year on year rental increase across the Build to Rent sector, according to the latest research from Ascend Properties.

The company has analysed rental market data on the sector to see which cities have seen the biggest increase in rental market prices – as well as where the Build to Rent sector is commanding the highest rental premiums when compared to the regular market. 

Research shows that 10 major cities across England have seen Build to Rent rental prices climb between 2019 and 2020, with some cities showing stronger growth than others. 

Largest Build to Rent rental increases

Newcastle leads the way with the current average rent in the sector at £858 – a 17% increase on the previous year. Leeds also had a strong rate of growth, up 6% with the current average rent at £892. Both Birmingham and Manchester come in third place with both cities seeing a 3% growth where year on year change is concerned. 

Liverpool and Sheffield both saw a 2% increase, with Sunderland and Plymouth at 1%, while Leicester saw 0.2% and Southampton saw 0.1%.

Biggest Build to Rent rental premiums

London remains in top place where the largest rental premiums in the Build to Rent sector are concerned. At £1,785 per month on average, Build to Rent properties in the capital command £146 more on average when compared to the average rental price of £1,639.

Both Oxford and Cambridge are the only other cities where the Build to Rent rental premium tops £100 at £126 and £104 higher than the average monthly rental income respectively. Other cities with the largest monthly rental premiums when comparing Build to Rent incomes with the regular market include Bristol at £94, Manchester at £77 and Leeds at £74.

“Despite a tough year, the rental market has stood pretty firm and it’s great to see the Build to Rent sector helping to drive top line growth across a number of major cities, while also continuing to command a premium when compared to the regular market. 

“This has been, in part, down to the wider lifestyle offering the sector provides. Homes designed for long term renting with the addition of social amenities and the greater availability of indoor and outdoor space is certainly something that is resonating with residents since lockdown restrictions were imposed. 

“With a greater sense of normality now returning, we should see this positive market growth continue to grow as more of us return to working, living and renting in cities across the country.”

Ged McPartlin, Managing Director, Ascend Properties