New data shows Build to Rent still achieving highest ratings

New data shows that Build to Rent is still achieving the highest ratings despite challenging 2022 for tenants.

HomeViews Build to Rent Report 2023 in partnership with Rightmove | BTR News
HomeViews Build to Rent Report 2023 in partnership with Rightmove.

Build to Rent residents are still consistently rating their homes higher than any other new build residents in the UK. This is despite ratings dropping for the first time last year – as tenants battled rising costs and the sector expanded and diversified.

For the third year running, residents in Build to Rent schemes rated their homes higher than both owners and private tenants in new build homes. However, the dip in ratings for Build to Rent is the first for the sector since HomeViews started collecting reviews in 2018.

The drop in Build to Rent resident ratings is partly driven by the sector’s rapid expansion, with £4.3bn invested in 2022 and many operators facing the challenge of operating at greater scale. With this expansion also comes diversification away from mainly city-based apartment schemes to add more suburban single-family housing (SFH) developments.

On HomeViews, Build to Rent apartment schemes achieve higher ratings than SFH communities, but also offer a variety of facilities, communal spaces and community events – contributing to the higher ratings. SFH is performing well when compared with ratings from both owners and private tenants in comparable new build homes.

This new data comes from the HomeViews 2023 Build to Rent Report, in partnership with Rightmove. This year’s report analysed nearly 11,000 verified resident reviews collected over four years, and covers 89% of completed rental-only developments in the UK.

“2022 was a challenging year for both tenants and the rental housing industry. Even historically strong performers like the Build to Rent sector felt the impact of factors like rising costs, rent increases and staffing shortages, and resident ratings dipped accordingly. However, Build to Rent apartments remain the country’s most popular new homes, and merit more support from planning authorities to counter the delivery slowdown we saw towards the end of 2022 as tough economic conditions hit the wider construction industry.”

Rory Cramer, CEO and Co-founder, HomeViews

The report also assessed the performance of office-to-resi rental developments when compared with purpose-built equivalents and found that these perform at a similarly high level. Converted developments even scored higher for their design, securing their place as a valid and sustainable solution to the need for more homes in the UK.

For the first time in 2023, comprehensive data on supply and demand in the UK Build to Rent sector was added by report partner Rightmove, who also looked at how tenant behaviour and interaction with Build to Rent has changed over the years.

The Rightmove data revealed that tenant demand in Build to Rent has more than quadrupled since February 2019 (+323%) due to more availability and awareness of the sector. The unique offering of Build to Rent is driving tenants to enquire from further away than the PRS, with nearly one in five leads (19%) into Build to Rent operators coming from a tenant living over 50km away from the development, compared with 14% in the PRS.

Rightmove’s analysis also found that listings which highlighted service-based features – such as being in an area with good transport links, being well connected and being professionally managed – generate the most interest from prospective tenants, while listings which highlight physical features such as a pool, cinema or café generate less interest per listing. These physical features are rarer and are still valuable selling points to the smaller group of tenants for whom these features are higher priority.

The data also analysed the Build to Rent sector at both a national and local level. The report revealed the differing priorities for tenants in different cities. For example, a Build to Rent listing in Manchester highlighting a gym generates more attention than an average Build to Rent listing in the city. However, it is less important to tenants in London and Birmingham.

“We’re in a unique position at Rightmove to be able to see how millions of tenants are searching for their next home, and what is clear is that while Build to Rent is still a small proportion of the overall rental market, there has been significant growth in the number of tenants considering a Build to Rent home in line with its increasing availability.

“The gap between supply and demand in the private rented sector has significantly widened during the pandemic making it a real challenge for many renters to secure a home, while we know from our own search data what tenants are looking for, for example a home that allows pets or comes with bills included. As Build to Rent availability grows, there is an opportunity to increase its appeal to the mass market of renters looking for an available home to rent with the amenities that are most important to them.”

Tim Bannister, Director of Property Science Innovation, Rightmove