BTR Sector to Surge in Next 5 Years

Knight Frank has unveiled some compelling statistics about the trajectory of the BTR sector. The most interesting revelation? The BTR sector’s worth might surge to a whopping £126 billion by 2028. Such an uptick isn’t just speculative either. The past trends affirm this prediction – the sector’s value has already climbed from £35 billion in 2019 to a significant £71 billion in 2023, doubling in just four years.

The Current BTR Landscape: Breaking Down the Numbers

As of now:

Completed BTR Homes: The UK houses around 90,000 completed BTR homes. But here’s the catch – this count only includes schemes that have at least 75 units.
Homes Under Construction: An impressive 67,000 units are currently being built.
Homes with Planning Permission: Another 74,000 homes have been given the green light and hold full planning permissions.

Collectively, these figures total over 230,000 homes that either exist, are being constructed, or are ready to be developed.

Additionally, in terms of pure monetary transactions, the third quarter of 2023 alone saw a hefty £698 million exchanging hands, making the year-to-date investment stand at a staggering £2.7 billion.

Expert Opinions: The Driving Forces and Predictions

So, what’s behind this BTR boom?

Guy Stebbings, Knight Frank’s head of operational build to rent, attributes this growth to multiple factors:

Rising Demand: More and more people across the UK are leaning towards rental homes. This can be attributed to changing lifestyle choices and evolving housing market dynamics.
A Response to Urgent Needs: The dire need for rental housing in the UK accentuates the positive societal role being played by investors. They are rapidly delivering the stock that the country urgently requires.
Predicted Growth: The belief that the sector’s value will nearly double by 2028, as per Stebbings, underscores its continued strength and capability to cater to renters’ shifting needs.

Lizzie Breckner, the head of build to rent research at Knight Frank, also chimed in, emphasizing the sector’s robust investment landscape. She remarked on the increasing appetite for greater choices and flexibility in the rental housing arena. The future? Breckner forecasts robust capital inflows, further propelling the BTR sector’s expansion.

Wrapping Up

The UK’s BTR sector is clearly on an upward trajectory, fueled by societal, lifestyle, and market shifts. For those pondering property investments, these trends highlight the BTR sector as a potential hotspot.