Property investments are taking a new direction, and for those considering diving into this market, understanding these shifts is crucial. The Build to Rent (BTR) landscape has undergone a significant transformation, transitioning from city-centric properties to embracing suburban communities. Estate Agent Today looked into the trend.
A Shift from London to the Regions
One of the most noteworthy changes in the UK property sector is the shift from London to regional growth. According to the Build to Rent Q3 2022 statistics provided by the British Property Federation (BPF), regional BTR is now growing almost three times faster than in London, registering a growth of 20% compared to London’s 7%.
This shift is not a sudden whim of the market but a response to changing demographics and preferences within the private rented sector.
Understanding the New Renter Demographic
The English Housing Survey of 2022 sheds light on a significant trend: over the past 15 years, the number of households opting to rent has shot up by a staggering 93%, while owner-occupied households have seen a marginal growth of just 3%.
This surge in renting isn’t purely an economic response to factors like mortgage rates. Instead, it indicates a broader, more profound societal change. Younger generations are showing a clear preference for the flexibility that comes with renting. Moreover, a new tenant demographic is emerging:
- Households with Children: There’s been a doubling of renting households with dependent children since 2003/4. These now constitute 30% of the rental sector.
- Comfortable Renters: This group, defined by those in managerial roles, degree holders, and those in good health, is also on the rise, making up 44% of renters.
Introducing BTR Suburban Communities
Historically, regional BTR was synonymous with terms like ‘suburban BTR’ or ‘Single Family Housing’ (SFH). However, after intensive research and consultation with experts from the Leaders Romans Group (LRG), a new term has been introduced: ‘BTR suburban communities’.
This term encapsulates what this new offering is all about: family homes situated outside bustling city centres. These homes offer not just individual living units but a cohesive sense of community, reminiscent of what made BTR popular in the first place. These communities embrace the core values of traditional BTR, such as:
- High-quality service
- Flexible tenancy agreements
- A commitment to sustainability
But they bring something unique to the table. As Millennials, the initial target audience for BTR, transition into different life stages, these suburban communities offer tailored solutions.
What Sets BTR Suburban Communities Apart?
A BTR suburban community is more than just a housing development. It provides an adaptable living experience. As family needs change, residents can seamlessly move between homes within the community, bypassing the hassles of traditional property buying and selling.
Notable features of these communities include:
- Turnkey Homes: Some homes are fully furnished, allowing new occupants to settle in instantly.
- Comprehensive Services: From 24/7 security to inclusive bills, and even amenities like cleaning, gardening, and dog-walking, these communities offer it all.
- Sustainable Living: Many communities are powered by renewable energy and come equipped with electric vehicle charging points.
- Entertainment and Convenience: Residents can enjoy facilities like cinemas, BBQ areas, lounges, and more, with concierges available to assist with various needs.
- Health and Well-being: Prioritising physical health and mental well-being, these communities provide facilities like gyms, bike storages, co-working spaces, and superfast broadband.
Aligning with Government Aspirations
BTR suburban communities also resonate with the Government’s objectives of sustainability, aesthetics, and the concept of the 15-minute neighbourhood. They’re well-positioned to meet housing demands and contribute to the levelling up agenda.
What Lies Ahead for BTR?
Having just celebrated its tenth birthday, the BTR sector has matured rapidly. However, there’s immense untapped potential. Moving beyond city bases, there’s growing investor interest, opportunities for developers to diversify, and an expansive market appeal.
With trends leaning towards renting and counter-urbanisation, coupled with political ambitions to refine the private rented sector, the future looks bright for BTR.
In conclusion, as the UK property landscape continues to evolve, BTR suburban communities are emerging as a promising and adaptive solution, catering to the changing needs and preferences of modern renters.