Increasing Investment in the Build-to-Rent Sector

In the UK, around 20% of households are renting privately. This trend has furthered the gap between social housing and home ownership. As such, the build-to-rent sector has benefited significantly from this growth. Since this sector is expected to grow in the next several years, investing in a build-to-rent property is considered a lucrative option.

The rise of purpose-built rental homes

Building large blocks of rental homes is a common practice in other developed countries like the U.S. but is relatively new in the UK. The building of rental homes that are meant to house thousands of tenants is considered to be one of the most attractive investment opportunities for developers and property management firms like Native Management. The rental industry is known to bring in a steady stream of revenue which is why developers are now focusing on building rental properties instead of homes for sale. Another benefit of the rise in rental properties is how it resolves the housing crisis in the country. Since home ownership has become quite expensive, long-term renting has become the go-to solution for most young professionals, even families.

Bespoke housing solutions

Another reason why tenants are choosing rental properties today is because of the variety of options. With developers looking to upgrade the experience, rental properties managed by private property management firms rather than individual landlords offer higher quality living conditions.

There are some companies investing in the build-to-rent sector which boast five-star services which aim to match the lifestyle of hardworking young professionals. In addition to the standard housing amenities, some rental properties even provide communal gyms, cinema rooms, and lounges.

Catering to a broad range of renters

While it may be an assumption that high-end rental properties are only meant to cater to the affluent professionals, there are developers who are focusing on making sure that average families in the UK can take advantage of the benefits of better living conditions.

Some developers are offering discounts to make these properties more affordable to middle-income families. This is in line with large-scale rental properties rising in several areas across the country to meet the demand for quality, yet affordable housing.

Should you invest in the build-to-rent sector?

With the promising numbers provided by surveys and research, it is a compelling enough reason to invest in the build-to-rent sector. If you are planning to buy a property and convert it into rental accommodation, there are two lucrative business models to adapt. You can opt for short-term leasing or long-term leasing. Short-term leasing is best when you want to take advantage of tourists or business travellers visiting the country.

If the property is located near the business sector or in areas close to tourist spots, short-term leasing is an excellent venture into the build-to-rent sector. On the other hand, long-term leasing is best when you want to bring in tenants who intend to stay for longer periods of time. These include families with young children or young professionals who are trying to move their way up the property ladder.

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Source: https://www.theguardian.com/housing-network/2018/apr/11/build-to-rent-developers-profiting-generation-rent